WASHINGTON (dpa-AFX) - CIT Group Inc. (CIT), Thursday said it agreed to sell CIT Commercial Air, its commercial aircraft leasing business, to Avolon Holdings Limited for $10 billion.
The transaction is expected to close by the end of the first quarter of 2017, subject to regulatory approvals and customary closing conditions.
CIT has received a 'non-objection' from the Federal Reserve Bank of New York for its Amended Capital Plan subject to the closing of the transaction. The plan authorizes CIT to return $2.975 billion of equity to shareholders from the proceeds of the sale and return up to an additional $0.325 billion of common equity contingent upon the issuance of a similar amount of Tier 1 qualifying preferred stock; and pay common dividends totaling $64 million per year after the transaction is completed.
'The sale of CIT Commercial Air represents an important milestone for CIT and follows an extensive dual-track process that was designed to maximize shareholder value. This transaction will strengthen our balance sheet, simplify our business and enable us to return significant capital to our shareholders,' said Ellen Alemany, Chairwoman and Chief Executive Officer of CIT Group.
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