Gama Aviation raising $67 million to expand

Gama Aviation hangar

With stock-markets stumbling around the world, this may not have been the greatest week to raise equity, but Gama Aviation – the business aviation company listed on the London Stock Exchange – has announced a £48 million ($67 million) capital raise. The company is placing shares with institutional investors and with Hutchison Whampoa, Gama’s Hong Kong partner.

Hutchison Whampoa will take 21% of the new issue and become a cornerstone investor in Gama Aviation.  Gama will use $19.8 million of the cash to buy out Hutchinson’s 20% stake in China Aircraft Services Limited – the Hong Kong aircraft engineering company – and its 50% stake in the Gama Aviation Hutchinson Holdings joint venture. Hutchinson says that it plans to be a long-term investor in the company.

Gama will use $20 million to invest in its US maintenance business and in its Sharjah FBO in the UAE. It hopes to use the rest of the money to buy aircraft operators or maintenance companies in Europe and the Middle East.

“We have put the people and systems in place that we needed to grow,” says Marwan Khalek, CEO of Gama Aviation, “we just needed the capital, and this capital raising has given it to us.”

NOTE: The below originally appeared as the editorial in our November 17 One Minute Week newsletter. To find out more, and sign up for free, please click here.