Business jet and helicopter finance company Milestone Aviation expects to have leased more than $300 million worth of aircraft by the end of the year, as the financial crisis and bank lending squeeze forces operators to look to alternative methods to fund aircraft procurement programmes.
Earlier this month, Milestone signed a leasing deal with Mexican air transport company Transportes Aereos Pegaso for four new Eurocopter EC-145 light twins, which will be used to support a multi-year services contract with government-owned utility company Mexican Comisión Federal de Electricidad.
The transaction is Milestone’s first with Pegaso, and its first acquisition of new Eurocopter helicopters.
“There are amazing finance opportunities right now,” Milestone managing director Robert Dranitzke said.
The Dublin, Ireland-based company – headed by former NetJets executives, including company founder and fractional ownership pioneer Richard Santulli – was set up in August 2010, to exploit a niche in finance market.
To date it has leased two dozen helicopters and private jets, valued at more than $200 million.
“We set up Milestone because we saw a gap in this sector left by banks, which cannot or will not lend to operators,” Dranitzke added. “They are not even prepared to lend money to a good operator with good contracts.
“Helicopters are a great investment as they hold their value, particularly models at the top end of the range.”
Milestone’s focus is mainly on operators with medium to long-term contracts, including offshore, public and government service providers.
Pegaso’s contract is for eight new EC-145′s, but the Mexican operator has elected to lease half of the fleet.
“For a business of our size, the smart way to acquire eight new helicopters is a blend of aircraft ownership and leasing, to strengthen our return on invested capital and allow us to pursue additional contracts,” said Enrique Zepeda Navarro, executive director of Pegaso. “Milestone delivered 100% lease financing on the first four helicopters, which will help us secure superior debt financing terms on the four remaining machines.”
By Kate Sarsfield