Stellwagen Group, acquired earlier this year by Acasta Enterprises Inc (TSX: AEF), has agreed to buy the commercial aviation advisory and asset management business of ECN Capital. The purchase price is US$22.5 million, payable through an issue of Acasta shares. Ireland’s Stellwagen, which operates in the same field, will gain an established asset management platform, expertise and greater distribution capabilities, Acasta said. Acasta bought Stellwagen as part of a $1.1 billion round of deals. A Canadian special purpose acquisition corporation (SPAC), Acasta plans to launch as a private equity firm this year.
Acasta Announces Acquisition of ECN Capital’s Commercial Aviation Business
TORONTO, May 12, 2017 /CNW/ – Acasta Enterprises Inc. (TSX: AEF.B and AEF.WT) (“Acasta” or the “Company”) today announced that Stellwagen Group, Acasta’s leading commercial aviation finance advisory and asset management business has entered into an agreement to acquire ECN Capital’s Commercial Aviation advisory and asset management business (“ECN Commercial Aviation”). ECN Aviation arranges, co-invests and manages a portfolio of commercial aviation assets on behalf of institutional investors. It comprises a highly skilled US based team and manages C$1.7 billion of aircraft assets.
“The acquisition of ECN Commercial Aviation further enhances Acasta’s specialized aviation asset management business,” said Anthony Melman, Acasta’s Chairman and CEO. “Stellwagen will capitalize on ECN’s successful platform as a vertically integrated provider of aviation advisory services. ECN Commercial Aviation is highly complementary with the core advisory and aircraft management businesses of Stellwagen, which provide holistic aircraft solutions to operators and institutional investors. This transaction will enable us to amplify Stellwagen’s reach, standing and value in the global aviation industry, and enhance and broaden our relationship with institutional investors.”
Highlights of the ECN Commercial Aviation acquisition are as follows:
It will provide Stellwagen with an established asset management platform, complementary expertise, and increased distribution capabilities
Acquisition includes ECN Commercial Aviation’s highly skilled team based out of Stamford, Connecticut, which has significant experience and relationships in the aviation industry
C$1.7 billion in assets under management, with a portfolio of 45 commercial passenger aircraft on lease to 30 global airlines
Transaction is expected to create significant strategic advantages and synergies when combined with Stellwagen, including internalization of aircraft servicing contracts and cross-sharing of existing institutional relationships
The acquisition is expected to be immediately accretive to 2017 earnings
The purchase price for ECN Commercial Aviation is US $22.5 million payable by the issuance of Class B Shares of Acasta at $10 per share with a one year lock-up, subject to a top-up of up to 10% if Acasta’s share price is less than $10 after the lock-up expires.
“We are acquiring and partnering with an experienced management team and a highly successful financing platform,” said Douglas Brennan, founder and CEO of Stellwagen. “This acquisition enables us to leverage ECN Commercial Aviation’s established fund platform, management team, and institutional relationships, significantly accelerating our initial goal of US$5 billion of assets under management.”
About Acasta Enterprises Inc.:
Acasta Enterprises Inc. is a leading Canadian public company that acquires businesses with exceptional potential for value creation through strategic and transformational initiatives. As a proactive private equity manager, Acasta partners with the senior management teams of its acquired businesses, empowering them to pursue value creating trajectories.
For further information: please contact: Acasta Enterprises Inc., Ian Kidson, 647-725-6707, Chief Financial Officer and Chief Operating Officer
Photo courtesy of Reuters/Mike Blake