CIT helps Virgo fund an aircraft deal

The $27 million senior debt offering will go toward funding the California investment firm's acquisition of Boeing aircraft from a Brazilian airline.

CIT Aerospace, the aviation-focused arm of New York lending firm CIT Group, has issued a $27 million senior secured credit facility to Virgo Investment Group, a private investment firm in California. The money is meant to finance Virgo’s acquisition of four Boeing 737-700 aircraft currently leased to GOL, a Brazilian airline, according to a statement from CIT. Each aircraft is equipped with CFM56 engines. The money for the transaction is being provided by CIT Bank, the US commercial bank subsidiary of CIT Group. Terms of the transaction were not disclosed.  

This marks CIT’s first deal with Virgo, a private, opportunistic investment firm that got its start in 2009 and uses a value investing tilt. Virgo focuses on dislocations in the market, targeting less efficient segments and identifying themes in the firm’s core industries. Founded in 2009, Virgo has about $500 million under management and has completed 34 investments so far within its core industries, which include aviation and niche industrials, media and entertainment, specialty finance, including real estate; health care and energy. The firm and is based in Redwood Shores, CA. 

CIT Aerospace provides customized leasing and secured financing to operators of commercial and business aircraft. The financing services include operating leases, single investor leases, leveraged financing, sale and leaseback arrangements, as well as loans secured by equipment. The division made several aircraft acquisition announcements earlier this month during the Farnborough International Airshow in England July 14 to 17.

CIT Group also announced earlier this month that it’ll be acquiring Los Angeles-based OneWest Bank. The merger is poised to create a lending giant with assets of $67 billion and deposits of $28 billion.