Mercuria Investment Co., Ltd. and Airborne Capital Limited Launch First Japan-Based Open-Ended Aircraft Fund
Mercuria Investment Co., Ltd. (“MIC”), a wholly-owned subsidiary of Mercuria Holdings Co., Ltd. (“MHD”), in collaboration with Airborne Capital Limited (“ACL”), a leading aircraft leasing and asset management firm headquartered in Ireland, has announced the establishment and operation of a new open-ended aircraft fund, titled MACH OE. This initiative represents a significant evolution in the aircraft fund landscape in Japan, reflecting both the growing sophistication of the country’s institutional investment market and the long-term opportunities presented by global aviation assets.
Historically, MIC and ACL have successfully co-managed closed-ended aircraft funds designed to meet the specific needs of Japanese investors. These funds offered investors structured portfolios of aircraft assets with predefined terms and limited liquidity options. MACH OE, by contrast, will be innovatively structured as an open-ended aircraft fund, offering unprecedented flexibility and liquidity in Japan’s aircraft investment market. According to research conducted by MHD, MACH OE will be the first of its kind in Japan, establishing a new benchmark for domestic asset managers in the alternative investment space.
The fund is targeting an asset size of over JPY 150 billion, underscoring the scale and ambition of this venture. Notably, the Development Bank of Japan is expected to act as an anchor investor, lending both credibility and financial support to the fund. MACH OE will primarily cater to institutional investors, including banks, pension funds, corporate entities, and academic institutions, reflecting its focus on stable, long-term investment returns.
In support of this new initiative, Daiwa JPI Alternative Investments Co., Ltd. (“DKAI”), a group company of Daiwa Securities Group Inc., will provide a range of services, including investor introductions and operational support. Furthermore, to enhance the strategic development of MACH OE, DKAI has entered into a memorandum of understanding with MIC and ACL, formalizing a strategic business alliance aimed at expanding aircraft investment opportunities in Japan.
Understanding Open-Ended Funds
An open-ended fund is distinguished by its operational flexibility, allowing investors to subscribe to or redeem shares in the fund during its operating period. This structure contrasts with traditional closed-ended funds, which generally lock in investor capital for a fixed term, offering little to no interim liquidity. By adopting an open-ended structure, MACH OE provides investors with the option to adjust their exposure to aircraft assets in response to evolving market conditions, while maintaining access to income generated by aircraft leasing.
The Current Aviation Landscape
The aviation industry has faced unprecedented challenges over the past few years, largely due to the COVID-19 pandemic, which caused severe disruptions to global travel and aircraft utilization. Despite these challenges, global passenger demand has rebounded strongly, surpassing pre-pandemic levels, and is projected to continue growing in line with global economic expansion.
Simultaneously, aircraft supply has remained constrained due to pandemic-induced disruptions in manufacturing and supply chains. As a result, aircraft manufacturers now carry order backlogs exceeding seven years, and industry analysts predict that the current shortage of aircraft will persist until the early 2030s. These factors have created a favorable environment for aircraft leasing investments, where demand outstrips supply and stable cash flows can be generated from leased aircraft to high-quality airlines.
Throughout the pandemic, MIC continued its investment activities, leveraging its experience to navigate volatile market conditions and accumulate valuable know-how in aircraft investment. This resilience has positioned MIC to capitalize on emerging opportunities in the post-pandemic aviation market.
MACH OE Investment Strategy
MIC first entered the aircraft fund market in 2017, establishing a successful track record with domestic and institutional investors. In 2022, the company launched MACH 1, Japan’s first post-COVID-19 aircraft fund sponsored by a domestic company. MACH OE builds on this experience, offering investors a unique opportunity to participate in an open-ended aircraft fund designed to generate stable cash flows by investing in in-demand aircraft types leased to select, high-quality airlines.
The open-ended structure of MACH OE is particularly innovative, providing investors with flexibility in their investment horizon—a feature that is rarely available in aircraft funds, which are typically closed-ended with fixed terms. This structure allows investors to tailor their investment strategy according to their liquidity needs while benefiting from steady income generated by aircraft leasing operations.
ACL brings substantial expertise to MACH OE, currently managing approximately 50 aircraft assets across more than 20 countries, with a total asset value of around JPY 230 billion. The firm has extensive experience managing third-party capital, including aircraft funds and asset-backed securities (ABS) structures, as well as providing advisory services related to aircraft investments. In Japan, ACL has previously collaborated with MIC on institutional investor-focused funds and has partnered with Daiwa Securities Group through Daiwa Airborne Co., Ltd. to offer aircraft investment opportunities to high-net-worth individuals.
Daiwa Securities Group’s Role
Daiwa Securities Group has long prioritized maximizing client asset value and advancing Japan’s position as a leading asset-management nation. The group emphasizes innovation in financial products, particularly alternative investments, to meet the diverse needs of investors. In the aircraft leasing sector, Daiwa Securities Group has been offering investment opportunities through Daiwa Airborne Co., Ltd. since January 2025, targeting ultra-high-net-worth individuals and institutional clients. Aircraft leasing is increasingly recognized as a compelling alternative investment, benefiting from strong lease demand growth tied to the expansion of global commercial aviation.
Within MACH OE, Daiwa Securities Group’s subsidiaries, including DKAI and Daiwa Asset Management Co., Ltd., provide investor access, operational support, and product development expertise. ACL, in turn, sources aircraft leasing opportunities and manages assets, ensuring that MACH OE leverages global experience in aircraft investment to generate stable returns for Japanese investors.
Comments from Industry Leaders
Atsushi Katayama, President and Representative Director of DKAI, highlighted the significance of this partnership:
Since our establishment in December 2001, we have operated as a specialist alternative investment firm, delivering solutions across private equity, infrastructure, real estate, hedge funds, and real assets such as aircraft and vessels. Joining the Daiwa Securities Group in 2025 has allowed us to further expand our capacity to provide innovative investment opportunities. By partnering with Mercuria Investment and Airborne Capital, pioneers in Japan’s aircraft investment space, we can now offer an open-ended aircraft leasing strategy that supports long-term asset formation and contributes to Japan’s leadership in asset management.
Toshihiro Toyoshima, President and Representative Director of Mercuria Investment, emphasized the growing importance of aircraft leasing as an investment class:
Aircraft leasing is rooted in real economic demand and capable of generating stable cash flows. While recognized as a valuable alternative investment overseas, aircraft investment in Japan has historically focused on tax-driven operating leases. Since 2017, Mercuria Investment has pursued fund-based aircraft investments backed by leasing income, continuing even during the COVID-19 pandemic. With MACH OE, we aim to provide flexible, open-ended investment solutions that meet evolving investor needs while delivering reliable returns, supported by the Daiwa Securities Group and the Development Bank of Japan.
Ramki Sundaram, CEO of Airborne Capital Limited, also remarked:
We are delighted to launch MACH OE, an innovative open-ended aircraft investment fund in partnership with MIC and DKAI. The fund’s unique structure allows investors to access non-correlated, cash-flow-generating aircraft assets while managing cyclical risks and benefiting from enhanced liquidity. Our growth in Japan since 2019 has been remarkable, and MACH OE represents a new milestone in providing institutional investors with high-quality aircraft investment opportunities.
The launch of MACH OE marks a significant milestone for Japan’s alternative investment landscape, introducing a flexible, open-ended vehicle in the aircraft fund sector for the first time. By combining MIC’s domestic expertise, ACL’s global aircraft asset management experience, and the strategic support of Daiwa Securities Group, MACH OE aims to provide stable, long-term returns for institutional investors while contributing to the broader growth and sophistication of Japan’s investment market.
The fund’s innovative open-ended structure reflects an evolving investor preference for flexible, income-generating alternative assets. With backing from leading financial institutions such as the Development Bank of Japan and a diversified investor base, MACH OE is positioned to become a flagship initiative in Japan’s aircraft investment sector, meeting both investor demand and the needs of the global aviation industry.
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