EQT backs Nordic Aviation Capital in $3.3bn deal

Greg Gille
05 August 2015

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EQT has acquired a majority stake in Nordic Aviation Capital, a Danish aircraft lessor, in a deal that values the business at $3.3bn.

Nordic Aviation's chairperson and founder, Martin Møller, will continue to chair the business and will remain a significant shareholder, contributing around 50% of the capital. Kirkbi Invest, an investor in EQT's Fund VI, will co-invest in Nordic Aviation alongside the GP.

As of June 2015, Nordic Aviation had net debt of $2.3bn and shareholders' equity of around $530m, according to EQT, who will finance the transaction via its EQT VI vehicle.

Morten Hummelmose, partner at EQT, told unquote" the aircraft leasing sector is an attractive market that has seen 4-6% growth year-on-year for a while now. Growth in NAC's market segment has been above those levels, and in its niche of turboprop aircrafts, NAC is a market leader, according to Hummelmose.

The company has already grown steadily, and made forays into the markets where growth is expected. "It's about supporting and boosting the growth NAC has had historically. Additionally, EQT and founder Martin Møller are supplying capital as part of the deal to further enhance the growth," he said.

As part of the transaction, NAC's existing financing will roll over, with no additional debt being added. Hummelmose said much of the existing debt is aircraft financing, which is not in need of restructuring.

The deal is still awaiting approval from the relevant competition authorities.

Company
Established in 1990, Nordic Aviation is an aircraft leasing company headquartered in Skive. The business specialises in turboprop aircraft leasing, with a current fleet consisting of around 250 aircraft with an average value-weighted age of 5.4 years. Its customer base comprises 40 airlines in 30 different countries.

Nordic Aviation generates net profit of $110m, with an aircraft asset base of around $2.9bn.

People
Morten Hummelmose led the deal for EQT. Martin Møller is the founder of Nordic Aviation. EQT stated it intends to supplement the company's board with financial and aviation experts from its network of industrial advisers.