General Aviation

“This is Major!” A major, major, profound proposed transaction in the FBO industry and this is it!

By January 18, 2021No Comments

On December 17, 2020, major breaking news (at least to the public in general, FBO Advisors and other insiders of course have known this going on behind-the-scenes for some time . . .) that private equity giant Blackstone has made a major move to acquire Signature Aviation in a blockbuster deal.

The astounding news: Blackstone made a £3 billion offer (USD $4,000,000,000) to acquire the largest FBO chain in the world!

Here’s the actual announcement by the London Daily Mail:

12/17/20 – MARKET REPORT: Bill Gates in the money as private equity giant Blackstone makes a move on Signature Aviation

Bill Gates was among the investors sitting pretty yesterday after private equity giant Blackstone made a move on Signature Aviation. Shares rocketed 40 per cent higher after Steve Schwarzman’s Blackstone made a £3billion offer to buy the company.

The private jet services group – previously known as BBA Aviation – is one of the lesser-known firms on the FTSE 250 index.

But it caught the eye of the Microsoft billionaire back in 2009 after the financial crisis.

And the 65-year-old, whose fortune tops £65billion, has used this year’s Covid chaos to snap up even more stock.

He has now built up a 19.2 per cent stake through his investment vehicle Cascade Investments.

That holding rocketed in value by £170million yesterday and is now worth around £600million after Blackstone offered to pay 383p per share, at a 42 per cent premium to the price before the offer was revealed.

No firm bid has been placed yet – but the likelihood is that Signature will be on the radar for lots of companies looking for a pandemic bargain.

Private jet businesses are some of the only aviation firms that have thrived during the pandemic as the super wealthy have turned to them more and more to go on holidays and business trips as normal travel has come to a virtual standstill.

Signature shares closed up 40.1 per cent, or 107.4p, to 375.4p, as it became the latest London-listed target for US private equity firms.

A flurry of questions naturally arise such as:

  • What does this mean for the US FBO industry?
  • What is the impact this will bring?
  • Will any domestic US locations need to be divested because of competitionconcerns and the need for US Department of Justice Anti-Trust approval?
  • Will this acquisition set a new “benchmark” for current FBO pricing and transactionsand other FBO businesses?
  • What is the significance of such a blockbuster acquisition in the middle of aworldwide pandemic of which we are still in the early stages of?
  • Andmanymore…Our “opinion” and discussion of these and other questions follows in our next blog as we mull over the ramifications of this historic offer to buy the industry leader in the FBO arena.Stay tuned!“These are days of Miracle and Wonder . . .” Paul Simon

    FBO Advisors, LLC
    Serving the FBO industry for more than 45 years

    Please feel free to direct comments to us on our views and opinions cited . . .