Air Lease (AL.US), the aircraft leasing company founded by industry mogul Steven Udvar-Hazy, has agreed to sell itself to an investor consortium for $7.4 billion in a deal that will take the company private and signals further consolidation in the aircraft leasing sector.

The acquisition announced this Tuesday is led by Japan's Mitsui & Co. and SMBC Aviation Capital, with asset management firms Apollo and Brookfield also participating. Los Angeles-based Air Lease shareholders will receive $65 per share, representing a premium of nearly 8% over last Friday's closing price. Including debt, investors value the company at approximately $28.2 billion.

Leasing companies rent aircraft to airlines, helping carriers save cash that would otherwise be needed to purchase planes—aircraft that can cost over $100 million each at list prices. In recent years, aircraft shortages caused by the COVID-19 pandemic, supply chain issues, and other factors have pushed rental rates for both new and used aircraft to record levels.

According to data from aviation consultancy IBA Group, the aircraft leasing business owns over half of the world's commercial aircraft fleet, with its ownership share growing from 51% in 2009 to the current 58%. This percentage has not increased further because some major airlines have achieved profitability, enabling them to own more aircraft directly.

"Cash is no longer foreign to these companies," said Stuart Hatcher, chief economist at IBA Group.

Meanwhile, many airlines are reconsidering their capacity plans as excess flights have depressed ticket prices and eroded profits. In an extreme case, Spirit Airlines filed for Chapter 11 bankruptcy protection on Friday for the second time in less than a year, after an initial attempt at major restructuring failed, instead facing rising costs and declining demand.

This privatization deal highlights the industry consolidation wave that will help related companies expand their scale. As of the end of the second quarter, Air Lease owned a fleet of 495 aircraft. According to IBA statistics, including reserve orders, Air Lease is the world's fifth-largest aircraft leasing company.

The parties expect the transaction to complete in the first half of 2026. The new company will be headquartered in Dublin.

"When you consider this is the cheapest way to buy market growth, it all makes sense," said IBA's Hatcher.

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Air Lease's acquisition is the latest in a series of deals. In 2021, General Electric sold its aircraft leasing division to AerCap, the world's largest aircraft leasing company, as the conglomerate was divesting business units to focus on core operations like aircraft engine manufacturing.

Two years ago, Standard Chartered Bank agreed to sell its aircraft leasing business to AviLease, owned by Saudi Arabia's sovereign wealth fund.

Udvar-Hazy, often called the "godfather" of aviation leasing, founded Air Lease in 2010 and worked closely with company CEO John Plueger.

"Since founding Air Lease in 2010, we have remained unwavering in our commitment to shaping the future of aviation by providing airlines worldwide with the newest, most fuel-efficient aircraft," Udvar-Hazy stated on Tuesday.

Udvar-Hazy is recognized as the founder of the aircraft leasing business. He co-founded his previous leasing company in 1973 (later renamed ILFC), which was subsequently sold to AIG. He operated that company until 2010 and announced his retirement from Air Lease in March of this year.