Sojourn Aviation: Directional Capital’s international play
Kenn Ricci's Directional Capital is looking abroad for new opportunities with Sojourn Aviation, a broker with cash to buy aircraft. The founder and owner of Flight Options also says that fractional ownership is coming back.
[nonmember]Kenn Ricci’s Directional Capital is looking abroad for new opportunities with Sojourn Aviation, a broker with cash to buy aircraft. The founder and owner of Flight Options also says that fractional ownership is coming back.::join::[/nonmember][ismember]
Kenneth Ricci is a serial business aviation entrepreneur.
In the last 30 years he has launched and invested in a range of companies including: Corporate Wings, an aircraft charter and management company, which he founded in 1980; Inertial Airline Services, a maintenance company; Flight Options, the US fractional operator, which he sold to Raytheon; and Directional Aviation Capital a specialist fund which invests in business aviation.
Directional, in turn, owns stakes in: Flight Options, which Ricci bought back in2008; Nextant Aerospace, which has a programme to upgrade Beechjet 400A Hawker 400XPs; and Constant Aviation, the business aircraft maintenance company. The fund also invested in Mercury Air Centers, a $200 million fixed based operations company which it sold to Macquarie Infrastructure Trust in 2007 for $615million. It also sold its stake in Inertial.
Sojourn Aviation Ricci’s latest venture is slightly different from the others which have predominately catered for North American customers. Although it is based in the US, the aircraft broker is focused on the international business jet market. “It is clear to us that the next cycle is going to be different to the others. This one will have a more international component. In the past private aviation has been largely about the domestic market. This is changing,” says Ricci.
Sojourn will buy and sell pre-owned aircraft like a traditional broker. But Ricci says it will have one advantage: money. “A lot of broker’s aircraft warehousing lines have disappeared. Sojourn will have the capital and appetite to buy inventory,” says Ricci. “The market will not stay like this for ever and the buying opportunity will only be there for a certain time.”
Sojourn is led by Brad Hatt who recently left Hawker Beechcraft after 17 years as a salesman. His roles at Hawker included president of commercial aircraft, general manager of domestic dealer sales, director of marketing, vice president of international special mission sales, vice president of domestic Beechcraft sales, and general manager/president of the Hawker division. He joined Hawker after 10 years at AlliedSignal Aerospace Group. He is managing partner.
Ricci is a partner along with Gary Wright who has 33 years’ experience in aircraft sales. During this time he has sold a variety of aircraft as a: a Cessna dealer, a Piper distributor, a Citation dealer, a Learjet distributor, sales manager for Duncan Aviation, RAC director and vice president for used aircraft and director of acquisitions at Avpro Jet. Whilst at RAC he once sold 187 Hawkers, BeechJets, King Airs, Barrons and Bonanzas in a single year.
The Sojourn team will also be responsible for Nextant’s international sales – which are likely to be half of all sales. At the moment the majority of customers for Nextant’s 400NEXT are in the US, including Flight Options which ordered 40 400XTs at the NBAA 2010 trade show.
The 400XT has an upgraded flight deck, with a Rockwell Collins Pro Line 21 avionics suite, Williams FJ44-3AP Engines (replacing P&W JT15D engines) and various aerodynamic improvements giving it an improved range of 2000 nautical miles. The upgraded aircraft costs about.
Ricci says that orders for the $4 million 400XT are strong and that Flight Options will not be able to take all its aircraft as quickly as it wished. “The Flight Options order is significant because it tells the market that there will be enough aircraft out there to make the product a success,” says Ricci.
But whilst the order has helped Nextant, Ricci says that Flight Options is not simply supporting a sister company. All of Directional’s businesses have a separate board and Flight Options is co-owned with other investors – including Resilience Capital (26%) and Stanley Capital (22%).
In fact, Ricci says that Nextant can help Flight Options.
“One of the reasons we were interested in buying back Flight Options in 1998 is because we thought the Nextant programme could benefit Flight Options,” he says. “We are very excited about the 400XT.”
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