LCI launches its first co-investment vehicle
Helicopter lessor LCI has just launched its first helicopter co-investment vehicle, in partnership with a subsidiary of Paris-based investment firm Flexam Invest.
The co-investment vehicle offers potential investors the opportunity to invest in five helicopters: three Leonardo AW139s and two Sikorksy S92s – valued at about $100 million. The aircraft are all on long-term leases and have already generated “significant interest”, according to LCI.
Both LCI and Flexam subsidiary Flexam Tangible Asset Income Fund capitalised the co-investment.
Co-investment vehicles allow investors access to asset classes – like helicopters – without having to build platforms like leasing companies. This one allows investors to choose individual assets.
‘New form of ownership vehicle’
Jaspal Jandu, CFO of LCI, said: “LCI is delighted to lead the helicopter leasing sector in launching this new form of ownership vehicle. It enables investors to participate at a specific transaction level and we are delighted to be partnering with Flexam whose professionalism in asset financing has been instrumental in executing this transaction.”
LCI’s fleet is comprised of approximately $1 billion worth of aircraft either in service, on order or under management. They are mainly medium and super-medium Leonardo, Airbus and Sikorsky helicopters.
Fabrice Fraikin and Florian de Sigy, both partners at Flexam Invest, released a joint statement saying: “The helicopter leasing marketplace is a dynamic one offering many investment opportunities. LCI is a leading lessor in this space possessing unrivalled experience and breadth of knowledge. Its track record as an aviation lessor is greatly respected by the financial community, making them an ideal partner for Flexam.”
Helicopters are, traditionally regarded as asset worth investing in. However, many lenders nowadays are reluctant to invest into the market due in part to the dwindling demand in the oil and gas market and an oversupply of aircraft in the market. But, opportunities are still there in certain niches.
Whereas lessors such as Macquarie and Milestone are owned by a large bank and conglomerate respectively, independent lessors have access to less capital and need to diversify their sources. LCI has demonstrated this by closing three new facilities with different lenders this year, one led by Caixabank – a first-time investor in the helicopter market.