Saturday 19 January 2019

Airborne Capital sizing up deals as Natixis takes stake

Ramki Sundaram, chief executive of Airborne Capital
Ramki Sundaram, chief executive of Airborne Capital
John Mulligan

John Mulligan

Airborne Capital, the new specialist aircraft lease and management firm backed by Kerry financial services firm Fexco, is working on a number of potential deal flows as it embarks on its plan to have at least $5bn (€4bn) of assets under management within five years.

Cian Dooley, a founding partner in the company, told the Irish Independent that he's confident the target will be met.

He also said Airborne Capital could ultimately have a number of aircraft types under management. "I see us having to be more thoughtful and more structured in transactions," he said.

"Over the next number of years, I see us having portfolios of new, younger, narrowbody aircraft, both current generation and the new generation, but also possibly, larger, mid-life or older aircraft too."

Mr Dooley said that there are capital sources interested "in all segments of the market".

He was speaking as Natixis Investment Managers, one of the world's largest asset management firms, confirmed it has taken a minority stake in Airborne Capital. Natixis is the asset management arm of French bank BPCE. Mr Dooley said Natixis had been in ongoing discussions with Airborne Capital about taking a stake in the fledgling Irish firm.

Airborne Capital's chief executive is Ramki Sundaram, who was previously global head of aviation at Natixis.

Another former Natixis executive, Jocelyn Noel, is also a member of the Airborne team.

Two executives from Dublin-based, Hong Kong-owned Goshawk Aviation, also joined Airborne as founding members.

They are Anand Ramachandran, Goshawk's former chief financial officer, and John O'Flynn, who worked in corporate finance at Goshawk.

Mr Dooley, a shareholder in Airborne Capital, declined to say what size of stake Natixis had taken, or how much it had paid. He said Airborne Capital expects to complete its first deal "within the calendar year".

"There's a significant amount of liquidity available, not just in our market, but in many markets. "There's plenty of senior debt, the lowest-risk debt, available. But once you get into the higher risk type of debt, then I think the availability starts to siphon away a little bit," said Mr Dooley.

"That's where we potentially see an opportunity, in terms of being able to source some of that debt for the upper parts of the capital structure.

"Other aspects, such as increasing regulatory capital requirements, will exert, in our view, some pressure on the availability of debt in the next few years," said Mr Dooley, who has worked in the past with GPA and Boeing.

He is also a former chief commercial officer at lessor Genesis Lease and also worked as an adviser to Natixis. "If you couple that with the very significant projected increases in aircraft being delivered and the number of aircraft requiring finance, it's creating an opportunity for new capital to come into the space and that's where we see our added value," he said.

"We're not adding value if we're going to the same debt providers currently in the market."

Mr Dooley said the fact that Natixis has taken a stake in Airborne Capital is a significant endorsement of the new firm.

Irish Independent

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