Singapore-based BOC Aviation priced on May 19 a US$1.1 billion initial public offering (IPO), representing the third largest IPO globally so far this year. It followed the US$1.9 billion IPO by China Zheshang Bank on March 21 in Hong Kong and the US$1.2 billion float by MGM Growth Properties on April 19 in New York.

This is also the second aircraft leasing company to list in Hong Kong on record, after the US$94 million IPO in July 2014 by China Aircraft Leasing Group, whose share price was up since listing, according to Dealogic.

BOC Aviation, the aircraft leasing subsidiary of Bank of China, priced its IPO at HK$42 per share and attracted 11 cornerstone investors totaling US$583 million or 52% of the deal. They include China’s sovereign wealth fund China Investment Corporation and China’s state-backed Silk Road Fund, which invested US$100 million each. The stock, though, lost steam on its trading debut on June 1 when it closed flat to its offer price, after climbing to intra-day high of HK$43.85. It has since faltered and fell below the offer price as it closed at HK$40.20 on June 10.

In contrast, China Aircraft Leasing has recovered from its poor performance on its first day of trading on July 11 2014 when it fell by as much as 7.6% from its offer price of HK$5.53 per share. It ended at HK$7.67 on June 10. Since March this year, the stock hit an intra-day high of HK$9.08 on April 19, before closing that day at HK$8.80.

The other BOC Aviation’s investors include CDB International, US aircraft manufacturer Boeing Company, China Life Insurance Company and Chinese private equity firm Hony Capital. According to Dealogic, cornerstone investment has taken up to 41% of Hong Kong-listed IPO volume, with a combined US$2.2 billion in 2016 year-to-date – on par with the record 41% in the full year 2015, when cornerstone volume amounted to US$14 billion, out of a total US$34 billion worth of new listings.

Bank of China, BNP Paribas, Citi, Goldman Sachs and Morgan Stanley were the joint bookrunners for the transaction. BOC Aviation has a portfolio of 270 owned and managed aircraft leased to 62 airlines worldwide in 30 countries. It has commitments to acquire 241 aircraft as at December 31 2015 with scheduled deliveries through 2021. The company has one of the youngest fleets in the industry with an average age of owned aircraft of 3.3 years, weighted by net book value. It signed 46 leases in 2015 and delivered 40 new aircraft.

BOC Aviation had another successful year in 2015 as it achieved a record net profit after tax of US$343 million, up 11% from a year ago. Total revenues and other income rose 10% to US$1.09 billion Meanwhile, with the BOC Aviation listing, the Hong Kong Stock Exchange leads the global IPO issuance with US$5.4 billion via 20 deals in 2016 year-to-date, albeit this was down from US$7.4 billion from 23 deals in the same 2015 period. Nasdaq came next with US$3.2 billion from 23 transactions, followed by the New York Stock Exchange with US$2.2 billion from six deals.