Challenge Aviation plc - Details of New Bond Issue
On 29 April 2026, Challenge Aviation plc published the Final Terms relating to up to €30 million 5.75% secured bonds maturing in 2032.
Challenge Aviation plc is the finance arm of Challenge Aviation Holdings Limited (the Guarantor) which is the holding company of several subsidiaries which own aircrafts and lease such aircrafts to other entities, primarily sister companies within the wider Challenge Group. Challenge Group is a global air cargo logistics specialist for large and complex cargo.
The salient details of the new bond issue are as follows:
Coupon:
5.75%
Amount Offered:
Up to €30 million (nominal)
Issue Price:
100% (par)
Maturity:
26 May 2032
Interest Payment Date:
Annually on 26 May (first interest payment date is 26 May 2027)
Ranking and Security of the Bonds:
The bonds will constitute the general, direct, unconditional, and secured obligations of the Issuer and will be jointly and severally guaranteed by the Guarantor. The bonds will, at all times, rank pari passu, without any priority or preference among themselves and save for such exceptions as may be provided by applicable law, without priority or preference to all present and future unsecured obligations of the Issuer and/or the Guarantor. This means that any secured or privileged debts of the Issuer and/or the Guarantor (which include the current encumbrances on seven aircraft) will rank at all times ahead of its obligations under the Bond Programme, as a result of which the bondholders may not be able to recover their investment in the bonds in the case of insolvency or an equivalent situation, whether in full or in part.
The bond is secured over a first-ranking Austrian law pledge over a Boeing B747-400F (MSN 33729) valued at USD39.8 million (approximately €34 million). The security also includes an insurance policy covering the secured aircraft with a replacement value of USD50 million (approximately €42 million). The security provider will also replace and/or add assets available to the trustee should the value of the secured aircraft fall below the principal of bonds issued plus one year of interest. The security package also includes a tripartite agreement binding the security provider, Challenge Airlines, and the security trustee on operator obligations and default procedures. Furthermore, an international interest will be registered on the Cape Town Convention International Registry.
Use of Proceeds:
The proceeds are earmarked for the refinancing of the USD41.5 million acquisition of the Boeing 777-300ERsf.
Plan of Distribution:
The bonds will be offered through an Intermediaries’ Offer with the possibility of Placement Agreements.
Minimum Subscription Amount:
€5,000 (nominal) and in multiples of €100 thereafter
Listing:
Official List of the Malta Stock Exchange
Expected Listing Date:
26 May 2026
Downloads:
Base Prospectus dated 16 April 2026
Final Terms dated 29 April 2026
Bond Fact Sheet dated 29 April 2026
Disclaimer:
This webpage has been prepared based on the Base Prospectus dated 16 April 2026 and Final Terms dated 29 April 2026 issued by Challenge Aviation plc and no representations or guarantees are made by Rizzo, Farrugia & Co. (Stockbrokers) Ltd with respect to the accuracy of the data. This webpage is for information purposes only. It is NOT intended to be and should NOT be construed as an offer or solicitation to acquire or dispose of any of the securities or issues mentioned herein. Rizzo, Farrugia & Co. (Stockbrokers) Ltd accepts NO responsibility or liability whatsoever for any expense, loss or damages arising out of, or in any way connected with, the use of all or any part of this webpage.
Investors wishing to acquire the Bonds should read the Prospectus before making any investment decision in order to fully understand the potential risks and rewards associated with an investment in the Bonds. A copy of the Prospectus is available on Rizzo, Farrugia & Co. (Stockbrokers) Limited’s website. Prospective investors are urged to consult their financial advisers as to the suitability or otherwise of acquiring such Bonds. The value of the investment and the income therefrom may go down as well as up and investors may lose some or all of the money invested.
This ADVERTISEMENT has been issued by Rizzo, Farrugia & Co. (Stockbrokers) Limited which is a company licensed to undertake investment services in Malta by the MFSA under the Investment Services Act, Cap. 370 of the Laws of Malta and a member of the Malta Stock Exchange. The Company’s registered address is at Airways House, Fourth Floor, High Street, Sliema SLM 1551, Malta.