The aircraft leasing sector is deep in an M&A wave as lessors and airlines alike continue their cruise into restructuring. Lessor consolidation has long been awaited by this fragmented and competitive sector and the pandemic appears to have finally pushed some bruised businesses into merging, with those in the industry expecting more to come.

At the same time, lessors including regional player Nordic Aviation Capital (NAC) are seeking further support from lenders after more than a year of depressed air travel. Airlines continue to topple too, with the largest of late being Mexico’s Interjet, meaning less homes for lessor aircraft. Typifying this is the Irish High Court’s recent decision to allow Norwegian Air Shuttle to reject 425 lease contracts with 68 counterparties.

Meanwhile, banks are getting increasingly repossession-happy as lessors struggle to make due on their secured loans. “Most of our business used to be getting the aircraft from airlines for lessors,” said one repossession source. “Now it’s the banks trying to get the aircraft from the lessors. Those conversations have really kicked off in the last couple of months.”