Chorus Aviation (TSX:CHR) subsidiary, Falko Regional Aircraft, sold eight aircraft that had previously been out on lease for USD$45 million after related debt repayments and taxes were taken into account.
Falko Regional Aircraft is an asset manager and aircraft leaser and its team has a considerable track record of selling aircraft, having completed more than 160 aircraft sales.
“I’m pleased to report that the first trading transaction of the Chorus/Falko era is taking place. This deal is transacting at one time book value and will generate net free cash flow of approximately USD $45 million. The recent Falko acquisition has made Chorus a market leading regional aircraft asset manager and the world’s largest aircraft lessor focused solely on the regional aircraft leasing space, significantly advancing our growth and diversification strategy,” said Joe Randell, president and chief executive officer of Chorus Aviation.
Based in Halifax, Nova Scotia, Chorus Aviation provides regional aviation solutions, including asset management services. Its subsidiaries include Falko Regional Aircraft, Jazz Aviation, which provides regional air services to Air Canada, and Voyager Aviation, which provides specialty air charter, aircraft modification and parts provisioning services to aviation customers and enthusiasts around the world.
This transaction is expected to close before the end of the Q3, 2022.
Some of the company’s most recent successes include closing the Falko acquisition for USD$843.7, including assuming its debt. That bumped the company’s net income by $5.7 million and adjusted earnings before taxes by $9.5 million, while expanding the company’s owned fleet to 381 aircraft, including 35 in a servicing capacity.
“With our first quarter since the Falko acquisition now complete, I am happy to see Falko delivering the expected results. In addition, the integration of Falko is progressing very well as both organizations share similar leadership styles and cultures. We have already begun to see the Falko asset management platform demonstrate its contribution to the diversification and flexibility of our business. In June, we announced the addition of 35 turboprop aircraft in a servicing capacity on behalf of a syndicate of banks, further expanding our asset management business and demonstrating Falko’s ability to broaden its customer base,” said Randell.