Corporate Jet Investor Awards 2014: The winners
Best Private Banks EMEA: Credit Suisse and UBS
The joint winners of the Best Private Bank EMEA focus on doing one thing really well: financing business jets for their bank’s clients. They do not try to do everything neither bank finances helicopters or super yachts. But what they do, they do very well.
“Both banks are extremely professional and are really a pleasure to deal with,” says one manufacturer. “When they say they are going to do something you really know that they will do it,” says another.
In fact, the biggest frustration that people have is that Credit Suisse or UBS are so focused on their niche: “I doubt they will ever do this but it would be great if they looked at a wider range of deals for customers that are not their clients,” says the manufacturer. “They have the knowledge and skills to do a lot more deals but I know this is unlikely.”
Best Aircraft Financier EMEA: Bank of America and CIT
Few institutions have as much experience of aircraft finance as Bank of America and CIT. Bank of America in particular has been the largest financier of US business jets for four years. But both banks are extremely strong in Europe, particularly when financing aircraft for companies and individuals that do not want to use their private bank.
Although the two banks offer similar product they do not always overlap. Bank of America is extremely strong with corporates but is also keen to work with more ultra-high-net-worth individuals, particularly following the bank’s acquisition of Julius Baer.
Whilst CIT does compete for these deals, the bank is particularly strong in Central and Eastern Europe, Ukraine, the CIS and Russia.
Best African Aircraft Financier: Investec
With deliveries of new aircraft to Europe down, in the last year a lot of financiers have started looking at Africa as a new source of deals. However, South Africa’s Investec still has a home advantage.
“It has taken some other banks a while to work out the opportunities in Africa,” says Melanie Humphries, head of aircraft finance for Africa at Investec,” but we are keen to keep leading the market.”
Investec’s Johannesburg based team also structures commercial aircraft transactions. This gives them a wide knowledge of different African jurisdictions as even if they have not financed a business jet in a country there is a good chance that they have looked at working with its airline.
“We do need help finding finance for African buyers,” says one manufacturer, “and Investec if a great option.”
Last year was another record year for Bank of America’s European team which is headed by Alex Badran in London.
“Bank of America know exactly what they are doing. They have great people in London and Germany and amazing support from the team back in the US,” says one manufacturer.
Best Middle Eastern Aircraft Financier: Deutsche Private Bank
Deutsche Private Bank only created a dedicated private jet team in 2012 when it moved Chris Partridge over from the investment bank’s asset finance team but it has quickly started closing deals.
As a relatively new entrant to business jet finance, the bank closed around 17 transactions worth around $500 million over a two-year period. It is focused on Europe, Middle East and Africa, but has closed deals in Asia and is ambitious to do more. Like other private banks, Deutsche Private Bank is only interested in supporting private clients and requires personal guarantees.
Best New Financier: Element Capital
Element Capital is still not particularly well known outside Canada but it soon will be. It was only launched in 2012 as a division of Element Financial Corporation to deal with large equipment financing and leasing transactions.
Led by Tony Bergeron, who has over 20 years of experience in equipment financing and leasing, the Montreal-based aircraft division acquired a $250 million US helicopter lease portfolio consisting of 63 helicopters.
Deal of the Year: Wheels Up’s $100 million debt facility/IALT pre-delivery payment facility
Led by VistaJet’s Thomas Flohr, IALT took a little while to go public. But it arrived in style, closing a $206 million pre-delivery payment for 10 Bombardier Challenger 605s – to be operated by VistaJet – with Aviation Finance Company (AFC).
This is an exciting finance deal it its own right. Many people have talked about encouraging capital markets investors into aviation, but apart from a few airline bonds (EETCs) very few people have actually closed deals. Noth IALT and AFC deserve real credit for this transaction.
Wheels Up’s $100 million debt deal for a fleet of King Airs was just as impressive, representing the largest ever turboprop debt financing.
Wheels Up is better known for its aggressive marketing, but it is also an innovative borrower. The record-breaking King Air was arranged by US investment bank Jefferies. Jefferies also invested as well as syndicating debt to two hedge funds.
Aircraft of the Year: Gulfstream G650
In 2014 there was only ever going to be one winner. The Gulfstream G650 was voted for unanimously by Corporate Jet Investor’s prestigious panel and its backlog justifies that it is a truly great aircraft.
Gulfstream break its own delivery record in 2013, shipping 42 G650s to lucky customers, and continued the same hot streak into 2014.
The aircraft was so in demand this year that people were even willing to pay well over the list price to get their hands on the G650, with two opportunistic owners choosing to flip their aircraft for as much as $70 million just months after receiving them.