Directional Aviation Capital has announced it is purchasing Flexjet from Bombardier, Inc. The new owners are also placing the largest new-aircraft order in Flexjet's history, valued at approximately $5.2 billion for up to 245 Bombardier business jets.
After 18 years as Bombardier's fractional jet ownership division, Flexjet is now joining Flight Options and Sentient as part of the Directional Aviation Capital portfolio of aviation companies. Bombardier will receive $185m for the company and the acquisition is expected to close by the year end, subject to regulatory review.
"Flexjet is an extremely well-run, profitable business known for its unmatched focus on owner experience and operational excellence," said Kenn Ricci, Principal, Directional Aviation Capital.
"Flexjet remains committed to providing owners with exceptional private travel experiences, while maintaining the highest standards of flexibility. We look forward to offering our owners and their guests access to the newest, most advanced aircraft available." Said Deanna White, President, Flexjet.
New Jets Ordered
As part of this agreement Flexjet has placed a firm order for 85 Bombardier aircraft, worth about $1.8 billion at list prices. This order is made up of 25 Learjet 75s, 30 Learjet 85s, 20 Challenger 350s and 10 Challenger 605s. There are additional options for 160 more aircraft, worth another $3.4 billion. Deliveries will begin in 2014 through to 2022, and will replace all of Flexjet's current fleet of about 80 aircraft within four years.
"With this historic order, Flexjet will remain a leading Bombardier customer and manager of the world's largest collection of the manufacturer's private jets," added Ricci.
Through its Flexjet, Flight Options and Sentient Jet brands, Directional Aviation Capital's portfolio companies will offer private air travelers a full range of choices as to how they fly. Their programs range from fractional ownership, membership, leasing, jet cards and charter.
"Our vision for Flexjet is of a luxury brand with a young fleet, the latest technology, hand-crafted interiors and an unmatched owner experience. That vision inspired this transaction and landmark order with Bombardier. There is tremendous opportunity for a bespoke brand in the private travel market and Flexjet, with its enhanced fleet, is uniquely suited to fill that void." Said Ricci.
Combined, these businesses account for over $1.1 Billion in revenues, operating over 150 aircraft in excess of 200,000 flight hours per year serving over 6,000 customers.
Flexjet, recently reported 96 percent growth of new fractional and jet card sales in the first half of 2013, compared to the first half of 2012. Earlier this year Sentient also reported good growth for 2012.
Bombardier has now seen three large orders over the last 2 years. At the end of last year Europe based VistaJet placed a $7.8bn order for over 140 long range Globals. Earlier in 2012, NetJets ordered up to 275 midsize Challenger aircraft. The sale of Flexjet "will allow Bombardier to focus on its core business areas," said CEO Pierre Beaudoin. In 2012 Bombardier was the world's largest manufacturer of business jets by revenue, with $5.8 billion in shipped sales according to the General Aviation Manufacturers Association.
Editorial Update: Flexjet increased this deal in October 2013, by converting 30 of the Learjet 85 options to firm orders, and adding options on another 20 aircraft. If all options are exercised the total order size will be $5.6bn for 265 aircraft.