Hangar8 acquires South Africa’s Star-Gate Aviation as it focuses on emerging markets

UK operator Hangar8 has acquired Star-Gate Aviation a South African operator with two aircraft on its air operator’s certificate (AOC). 

“It has taken us a long-time to acquire Star-Gate but it is 18 months quicker than setting up on our own AOC,” says Dustin Dryden, CEO of Hangar8.

Hanagar8 was able to meet restrictions governing ownership because Dryden, the listed company’s majority shareholder, has South African citizenship.

Chris Perry, the founder and owner of StarGate, has been issued with shares in Hangar8 worth £330,000 ($500,000).

“Having the AOC is important to us because it is difficult to find financing for an aircraft in Africa which is not registered on the South African register and 90% of all aircraft are financed,” says Dryden.  He says Investec, Rand Merchant Bank and Standard Bank – South Africa’s most active corporate aircraft lenders – have all approved Star-Gate.

Hangar8 will also use Star-Gate to increase its focus on medical repatriation flights. Many international employers guarantee staff that they will fly them for treatment to Europe in the event of illness or an accident and Start-Gate specialises in this market. “There are 275 medical evacuation aircraft in the US,” says Dryden, “There are just seven in the whole of Africa.”

Although Hangar8 has been involved in repatriation for a number of years Dryden says it has not been a core part of its business. It plans to convert a customer’s Challenger to a specialist emergency and medical services aircraft.

The company which added a Maltese AOC at the start of 2012 has also applied for a Nigerian AOC and applied for the right to set-up a maintenance base in Russia.

“We are following the best performing economies,” says Dryden. “GDP is growing by 9% in Nigeria compared to negative growth in the UK. There is a lot of demand in countries like Ghana, Kazakhstan and our Asian business is also doing very well.”

Hangar8 listed on London’s Alternative Investment Market in November 2010 partly to provide it with funds for acquisitions. Star-Gate is the first deal to have closed. “The problem is that so many of the company’s we have looked with are so badly run,” says Dryden. “Star-Gate is well run so we bought it.”