It looks like my intuition is turning out to to be right, in that Steven Udvar-Hazy is apparently leading an effort to buy ILFC back from AIG. I have very high confidence that Mr. Udvar-Hazy will make the deal happen.

Breaking news is that AIG may be looking to sell ILFC to raise capital and restore investor confidence. With a fleet of around 1,000 aircraft, ILFC the world’s second largest aircraft lessor, trailing only GECAS. What I’m wondering is who will come up with $14 Billion? If time was not important, I would think a spin-off and IPO would probably be the best course of action for both ILFC and AIG. Given the circumstances, though, I can’t see that happening. Off the top of my head, I can’t think of any likely single buyer from the United States. I could imagine a deal structure where Steven Udvar-Hazy helps take the company private along with the help of private equity. I can also imagine there being some interest from investors in the Middle East.

People who have been in the leasing business for a long time are probably enjoying the irony that it is the lessor who is being dragged down by the parent company this time around.