Jet Aviation buys Hawker Pacific
It is not uncommon for a company to book a last-minute booth for a trade show, like ABACE which takes place in Shanghai next week. But this must be the first time that an exhibitor has bought the whole venue.
Jet Aviation this week agreed to buy Hawker Pacific for $250 million. And it is a deal with a lot of winners.
It is clearly a good deal for the sellers. Private-equity company Britton Hill (which owned 65.82%) and shipping firm SEACOR (34.18%) have both obtained good returns on their investments. The size of Britton Hill’s investment in 2014 was not disclosed, but SEACOR paid $25 million for its stake in 2010. Neither of them was a forced seller. In fact, one of their biggest drivers was the influx of capital into business aviation at the moment. Both owners wanted to sell while the sector is still hot, and so asked Jefferies, the leading business aviation investment bank, to start the sales process in 2017.
But it is also a deal that makes sense for Jet Aviation. The General Dynamics subsidiary – and sister company to Gulfstream – already has a very strong Asian business. But adding Hawker Pacific – which has the largest network of FBOs and MROs in Asia – will make it even stronger.
The acquisition also makes life harder for competitors. During the sale, Jefferies kept highlighting the fact that buying the 40-year old Hawker Pacific was the last chance for someone to get significant market share in Asia through a single acquisition.
It is worth sparing a thought for the unsuccessful bidders. Not only have they spent many hours fruitlessly conducting due diligence and discussing synergies in meetings, but now many of them have to spend next week in a Hawker Pacific facility watching the deal being toasted on the Jet Aviation stand.
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