In two separate deals here yesterday, global aircraft finance company Milestone Aviation Group (Booth No. 7010) announced with OEMs Eurocopter (Booth No. 1917) and Sikorsky Aircraft (Booth No. 6148), respectively, orders for 16 Eurocopter EC225s and three Sikorsky S-92s. The EC225 order is valued at $480 million. Terms of the S-92 contract were not disclosed.
Financing, Insurance and Taxes
Issues regarding financing of aircraft; aviation insurance; tax issues for aircraft operators; new companies and people in the aviation financing and insurance industries.
In two separate deals announced yesterday at Heli-Expo, global aircraft finance company Milestone Aviation Group signed orders for 16 Eurocopter EC225s and three Sikorsky S-92s. The Eurocopter order is valued at $480 million; terms of the Sikorsky contract were not disclosed. Deliveries of the EC225s are planned to start next year, with Milestone taking approximately three aircraft per year. In the Sikorsky deal, Milestone will take two S-92s in the second half of this year, with the third slated for delivery early next year.
Sikorsky Aircraft recognized Vancouver-based Helijet International as operator of the world’s highest time Sikorsky S-76 airframe. Helijet’s S-76A, S/N 760074, has logged a total of 37,025 flight hours. It entered service in July 1980 and then flew 2,287 hours during nine years’ service as a corporate transport in the northeastern U.S. Helijet acquired the aircraft in January 1990. In scheduled service, it has carried more than 500,000 passengers some three million miles between Helijet’s passenger terminals in Vancouver and Victoria, British Columbia.
The business aircraft finance world will converge at the second iteration of the International Corporate Jet and Helicopter Finance Conference, to be held in London next week. The February 7 and 8 event is expected to attract more than 200 delegates and speakers, including representatives from more than 30 international finance institutions from 17 countries. According to conference organizer Corporate Jet Investor, 70 percent of all worldwide business jet and helicopter purchasers receive financing.
Politicians like to use the term “dead on arrival” to refer to unpalatable bills, and that’s how 116 bipartisan members of the House earlier this year described a trial balloon floated by the Obama Administration on user fees for general aviation.
The big financial freeze that has gripped much of the aerospace industry since around the time of the last Farnborough airshow in 2008 is starting to thaw. And, as a consequence, deal making is back in fashion.
This was the headline assessment of the state of the sector from Michael Richter, managing director of the aerospace and defense group of financial advisor and asset manager Lazard on the eve of this week’s show.
NBAA applauded the Washington State legislature’s decision to scuttle a provision for an “onerous” tax proposal for aircraft in its annual spending bill. To oppose the tax hike, NBAA banded with other groups–including the Pacific Northwest Business Aviation Association, AOPA and the Washington Pilots Association–to form a unified grassroots coalition known as the Washington Aviation Coalition.
Alan Klapmeier, chairman of Cirrus Aircraft, has formed a team to raise funds to try to buy the Vision SF50 single-engine personal-very-light-jet program from Arcapita Bank, the majority owner of Cirrus. “I feel comfortable that we can do this,” said Klapmeier.
Bend, Ore.-based Stratos Aircraft last month began taking refundable $50,000 deposits, which will be placed in escrow, for its four-seat, single-engine Stratos 714 personal very light jet. The first 25 aircraft will be sold for $2 million each, after which there will be a modest, but as-yet-undetermined, price increase.
“Only in 2012 will [business jet] deliveries start growing again,” Embraer executive vice president Luis Carlos Affonso said in a pre-LABACE press briefing. He expects 2010 and 2011 will be “difficult years” for the business aviation industry, but noted that there are already signs that the industry is starting to recover. He said the company will meet Phenom delivery goals, if it can build the airplanes fast enough.