Miami-based H.I.G. Capital finalized its acquisition of Cleveland-based Flight Options, LLC from the Raytheon Co., and concurrently announced a firm order for 100 Phenom 300 light jets from Embraer.
By Karen Di Piazza
Miami-based H.I.G. Capital finalized its acquisition of Cleveland-based Flight Options, LLC from the Raytheon Co., and concurrently announced a firm order for 100 Phenom 300 light jets from Embraer, a Brazilian aerospace conglomerate. The announcement of the purchase of Flight Options from Raytheon, for an undisclosed sum, came in October; the deal closed Nov. 30.
The Phenom order sends an unmistakable signal that H.I.G., a global private equity firm, supports the growth of Flight Options, the world’s second largest dedicated private jet fleet and fractional provider.
The Phenom aircraft order, scheduled for delivery throughout the next decade, includes options for 50 additional aircraft. The first delivery is scheduled to occur in late 2009.
The relationship between Embraer and Flight Options dates back to 2003, with the acquisition of its first Legacy 600. As of Dec. 1, the company listed eight Legacy 600 aircraft in its fleet.
Embraer said the Phenom order is the company’s largest executive jet order, worth $746 million, based on 2007 list price. The total order could reach $1.12 billion, if the buyer exercises all options. An additional agreement for a maintenance and support program is valued at more than $200 million.
“Embraer’s reputation for innovation and best-in-class products is evident in every aspect of the Phenom 300,” said Michael Scheeringa, CEO of Flight Options. “With an outstanding combination of performance, cabin comfort and baggage capacity, the Phenom 300 will become the mainstay of Flight Options’ fleet.”
In December, the company’s fleet listed more than 140 aircraft, including Hawker 400XPs and 850XPs, Citation Xs and Legacy 600s; however, Flight Options plans to phase out the 400XPs. Dennis E. Baker, director of corporate communications of Flight Options, said the company would transition its fractional light jet from the 400XPs to the Phenom 300s, starting in 2010.
“This transition is estimated to take seven years to complete,” he said. “I don’t have specific numbers of retiring aircraft year-by-year.”
Although the deal closed with H.I.G., will everything still run smoothly with Flight Options’ existing management? Baker says H.I.G.’s view of the industry matches that of Flight Options’ “go forward plan,” for both short-term and long-term commitments.
“There are no management or operational changes expected as a result of the transaction; we expect continuity with the business plan,” he said.
Powered by Pratt & Whitney Canada’s PW535E engines, the Phenom 300 promises unmatched amenities and low operating costs. With the aircraft’s 1,800-nautical-mile range and seating for four passengers, its maximum operating speed is Mach 0.78.
Designed for short field takeoff performance, the plane is capable of flying at 45,000 feet.
“Our intention is for Flight Options to be the most innovative, forward-looking and professional company in private aviation,” said Doug Berman, a managing director at H.I.G.
Both Flight Options and Embraer agree that the airplane was specifically engineered for high utilization and reliability—characteristics that make it a perfect match for the fractional aircraft ownership market.
Frederico Fleury-Curado, Embraer president and CEO, said together, Flight Options and the Phenom 300 are changing the face of private aviation.
“We’ve developed an ideal jet for the next generation of private air travel,” he said. “We’re gratified that we have the ideal business partner bringing the first order to market.”
For more information, visit [http://www.flightoptions.com].