NH Investment acquires $70 mn debt in aircraft finance for Qatar Airways

NH Investment & Securities Co. Ltd. has underwritten $70 million mezzanine debts of around $300 million financing to buy two aircraft operated by Qatar Airways Co.

The South Korean brokerage firm acquired the debt through a nine-year fund of Hyundai Asset Management Co. Ltd. for an expected annual return of slightly over 5%, according to a source with knowledge of the matter on May 31.

The domestic fund closed last week to finance the purchase of two Boeing 777-300ER aircraft and lease them back to Qatar Airways.

NH Investment aims to resell its interest in the fund to domestic institutional investors.

A string of South Korean brokerage firms have recently participated in aviation financing for the Boeing 777-300ER model which is highly sought after in the used aircraft market.

Their investment is concentrated mostly in mezzanine notes for top-tier, or state-owned airlines such as Qatar Airways.

Last month Hana Financial Investment Co. Ltd acquired $50 million mezzanine debts in an aircraft fund for the purchase and lease of one 777-300ER aircraft to Qatar Airways.

daepun@hankyung.com