Airbus investigation shines light on Avinco ownership
Airbus has launched an internal investigation into allegations of €16.2 million worth of payments by two companies associated with the manufacturer after the Guardian newspaper uncovered the “questionable financial transactions”.
One of the companies is Avinco Holdings, which holds 14,999 shares in Avinco, the Dublin-based aircraft lessor and trader. The second is Maltese retrofitting firm Eolia, a company described by the Guardian as “under Airbus’s effective control”.
There was an agreement in place that gave Airbus the ability to seize control of Avinco Holdings at any time from its owner. That deal looks to have been exercised in 2007, when Eolia reportedly bought 26% of Avinco Holdings shares.
When this information became public, Airbus started an internal investigation. A statement from the manufacturer to Helicopter Investor said: “As part of our on-going compliance upgrade and investigation into historic business practices within the company, Airbus is determined to uncover any non-compliance and improper practices to ensure that they can never happen again.
“If non-compliance is identified the company will take all actions necessary to root it out, inform the relevant authorities and ensure those responsible are held accountable.”
Avinco – “First Choice”
Rumours that Airbus owns the majority of Avinco have been circulating for a while. The two companies have a close relationship, with Avinco receiving first choice of second-hand aircraft that is sent back to Airbus.
One broker told Helicopter Investor: “For 15 years it has been widely understood that Airbus had most of the ownership and control of Avinco.
“Thats how they got first choice on all the preowned aircraft that comes back into or is traded though Airbus Helicopters for so long. Of several contracts or tenders over the years we tried for, the doors wouldn’t open at all due to this fact.”
Avinco Holding’s PR firm declined to comment on the situation.
Not a good time
If there is one thing that Airbus doesn’t want right now, it’s having its name within a mile of a financial scandal. Last year, the UK Serious Fraud Office started an investigation into the company concerning “irregularities concerning third party consultants”, where Airbus had allegedly fudged reports to secure financial backing.
Airbus’s helicopters have had a mixed 2017. Revenues are up by €34 million for the year’s first half compared to 2016 but EBITDA is down from €144 million to €93 million. This comes off the back of a market that is hitting manufacturers hard and the widely reported H225 crash in Norway and following grounding of the model that would have hit the company.