For helicopter industry veterans, Wall Street the SEC and many former and present employees, it might be hard to believe that MD Helicopters has been a Lynn Tilton company for 10 years. But it is a fact, and this was the theme of the Mesa, Ariz. company’s press conference on Tuesday here at Heli-Expo 2015.
“MD Helicopters was born at the intersection of innovation, technology, design and manufacturing. The ‘House that Howard Hughes built’ changed the world’s rotorcraft industry by delivering beautifully simple engineered masterpieces,” said Tilton, CEO of MD Helicopters. “When I acquired the company in 2005, I don’t think anyone believed this iconic American brand could rise again, yet we stand today stronger and better prepared than we have ever been for a future of innovation, expansion and growth.”
Among main achievements Tilton mentioned was the company’s re-entry into the defense market. Sales include training and armed helicopters in service with the Afghan Air Force, Saudi Arabian National Guard, El Salvador Army, Costa Rica Police, Royal Jordanian Air Force, Mexican Air Force, South Korean Air Force and others, according to the company.
“I am very proud of what my MD team has accomplished,” Tilton said. “We are continually improving supply chain performance, delivering responsive global customer service and support to a growing installed base, and we have returned to our historic legacy: providing high-performance, safe, reliable armed scout helicopters to the U.S. Army and our allies. With these steps, we are well positioned to take on the challenges of our next decade and beyond.”
Tilton also announced that MD Helicopters plans to build a new version of its twin-engine MD 902, which suffers from the high cost of parts and their frequent unavailability because of outside part suppliers, she said. Tilton herself owns a 902, which is the one on display at Heli-Expo.
“Today I’ve been calling it the 969. I like that. It rings true,” she said. “We are redesigning the aircraft, so that we can manufacture a lot of the parts in-house. And we’ll begin to control a lot of our supply chain on the 902. This has allowed us to be successful on the single-engine line.” She added that MD “is bringing in some veteran engineers from the outside to focus on this project.”
Asked if potential SEC enforcement action over the management of risky corporate loans made by Tilton’s private-equity firm, Patriarch Partners, which also owns MD Helicopters, was having an effect on MD Helicopters, Tilton responded, “I own 75 businesses. I am the largest female-owned business in America. If you think this is the first time that I’ve ever had an investigation by a regulatory body, then you’re naïve. It is not affecting MD or any of my companies. It has nothing to do with the operating companies. It is something I disclosed to the world that there is a potential regulatory issue in my life. And it is business as usual, or I wouldn’t be standing here. There is absolutely zero effect on MD Helicopters or any of my other portfolio companies.”
According to a Bloomberg Business report last month, Patriarch sent a letter to investors in the loan obligations it had created advising them of the SEC’s action and that it had hired an investment banker to begin talks with investors about restructuring the loans.
New Orders Announced
Yesterday, the company announced a contract to manufacture and deliver a new MD 520N helicopter to the Volusia County Mosquito Control in Florida. The single-engine 520N will join the unit’s two MD 500E helicopters to expand the department’s ability to inspect and treat the region’s wet and drylands not serviceable by trucks or other ground methods.
It also announced a contract to manufacture and deliver a new helicopter for the Mesa Police Department Aviation Unit. Acquisition of the new MD 530F was approved by the Mesa City Council as an addition to the department’s existing fleet of two MD 500Es. The 530F will feature a 650-shp Rolls-Royce 250-C30 engine, extended tail boom and longer main-rotor blades and will be equipped with a Garmin 500H glass cockpit, GTS800 Traffic Avoidance System and GTN 650 to support navigation, communications and safe flight operations.