Lobo Leasing searching for deals
Well-backed by Perella Weinberg Partners, Lobo Leasing’s CEO Bill Wolf says the helicopter financier is open to all enquiries and actively searching for deals
If you do not speak Spanish, you would not realise that Lobo Leasing is named after its founders: Bill Wolf, the CEO, and his father Howard Wolf, the firm’s chairman. But it is not just a small family business. As well as Bruce Mauldin and John Contas, two experienced helicopter specialists, Lobo Leasing is partly financed by Perella Weinberg Partners, a privately-owned financial advisory firm and fund manager and has several hundred million to invest.
Bill Wolf says it is a team. “We knew each other and had invested together in the past. Someone brought us a leasing deal, and we realised there was a bigger need in the market for lessor capital,” says Wolf.
Lobo will offer 100% financing on new, pre-owned and sale-leaseback transactions, and its chief executive stresses that it will be willing to listen to all offers.
“We are open to a broad range of ages and types. We will work with the more exotic, so-called ‘non-Western aircraft. We are open to all enquiries.”
There are just two conditions. “We have a strong preference for medium and heavy aircraft, as the finance
market for the light models is much more developed,” says Wolf, “and deals worth under $1 million are not really our business.”
Wolf would not be specific about any deals struck since the agreement with Perella was formalised in May. “We do
have a lot of commitments, and we are active in the marketplace right now.”
He did reveal, however, that Lobo’s team has in excess of $200 million available, and that this can be
leveraged higher. “We expect to invest that initial number and beyond that within five years,” he adds.
Perella’s investment is another sign that there is increasing confidence in the strength of the helicopter
finance market. Milestone Aviation, which last year received a $500 million investment from Jordan Company and Nautic Partners, will be Lobo’s most direct competitor.
“Demand for helicopters, and therefore demand for capital, certainly fell in the downturn,” says Wolf, “but now the underlying commodity is strong and demand in the offshore space is very healthy.”
While Wolf expects the offshore market to be Lobo’s biggest, the company is also aiming to break into niche
markets and finance aircraft for both the US and foreign governments. Wolf is optimistic about the range of opportunities in helicopter leasing, given developments in the market since the downturn.
“There were certain sectors in which we didn’t think we would ever be able to compete given the price of capital that was available, but that has shifted,” he says. “The offshore market was an example of that.”
Wolf, a former banker, says the scarcity of capital available for helicopter leasing was a result of banks and other large financial houses pulling out of the market when their other arms were in trouble and not the helicopter market itself. “We are much more stable than multi-armed financiers, because we don’t have any other lines of business that can go wrong.”
Having worked together for 20 years previously, the team’s experience in the industry will be vital in establishing a market presence for Lobo Leasing. Wolf agrees that these relationships have been very helpful to Lobo, but says they are also reaching out in search of deals.
The helicopter market is growing, and the demand for capital will grow with it. Milestone penned a landmark sale and leaseback deal with CHC Helicopter in September worth $80 million, and financed helicopters worth $140 million in its first six months.
On the demand side, Spanish group Inaer is now owned by private equity firms Investindustrial and KKR, and has been making a series of international acquisitions of smaller operators.
In a growing market where capital is tight, Bill Wolf should find himself and Lobo Leasing rather busy.