China-based Bohai Leasing has entered into an exclusivity agreement to acquire Irish aircraft leasing firm Avolon Holdings for $2.6bn.

Under the deal, the companies will be able to negotiate definitive agreements for the proposed transaction up to 7 September.

Current terms state that Bohai will buy Avolon’s issued and outstanding common shares for $32 per unit.

Bohai will deposit $50m into an escrow account, in addition to the $25m already held in connection with the cash tender offer made by Bohai on 31 July.

"Bohai will increase the deposit to $250m if the deal is not concluded under certain circumstances."

If Avolon intends to formalise the definitive agreement, it will be eligible to receive the $75m deposit; however, Bohai will increase the deposit to $250m if the deal is not concluded under certain circumstances.

Avolon has a total enterprise value of $7.6bn and this deal will give 100% ownership to Bohai.

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Avolon operates offices in China, Dubai, Singapore and the US. As of 30 June, the company had a fleet of 260 aircraft on order, or serving 56 customers in 33 countries.

In July, Bohai signed a deal to acquire a 20% stake in the company Avolon for $429m.

Last year, Aviation Industry Corporation of China (AVIC) and China Investment considered acquiring Avolon for around $5bn, but negotiations ended between the companies.