Acquisition will take Stratos’ managed portfolio above 60 aircraft worth over $3bn
Monaco: 6th March 2023
Stratos, a leading independent aircraft investment specialist, has today reached an agreement to acquire Magi Aviation Capital (“Magi”), a fellow independent aircraft finance specialist and aircraft asset manager, and its various subsidiaries.
The all-cash deal, which has recently received regulatory approval from the UK Financial Conduct Authority, will see Stratos acquire Magi in its entirety, and is expected to be completed in the coming weeks.
As part of the acquisition, Stratos will inherit management contracts of four aircraft (comprising one A380 and three 777’s, excluding pipeline) leased to leading Middle Eastern airlines. This takes Stratos’ managed portfolio to over 60 aircraft worth $3bn with annual rental receipts in excess of $300m.
Stratos will also be welcoming Magi’s team of experienced aviation finance and leasing specialists, taking the total Stratos team to over 30 professionals. The Magi team includes industry veterans Neil Lewis (Head of Operations); Jason Bewley, (Head of Business Development); Fraser Chestney (SVP Corporate Finance); Jelena Stefanovic (SVP Corporate Finance); Annika Hansson (VP Lease Management) and Tina Richards (Financial Controller).
Peter Vardigans, Magi co-founder and current Executive Chairman, will continue as part of the combined team in an advisory capacity. Fellow co-founder and former CEO, Sean Cleghorn, will be leaving the business upon completion of the acquisition.
The Magi team has arranged and closed $2.5bn of - mainly wide-body - lease financings since 2015, most of which were originated by Magi directly with airlines.
The deal will also see Stratos acquiring offices in London, Doha and Brisbane, to add to its existing presence in Shannon, Monaco and Tokyo. Furthermore, Stratos will inherit fund-related licenses including UK FCA regulated activities to complement Stratos’ existing servicer ranking from Standard & Poors.
The acquisition complements Stratos expertise, including a combined remarketing/sourcing track record of 120 aircraft valued at $6.5bn and total financing of $3.8bn raised over the past decade. The combined teams have delivered multiple deals returning equity IRRs well in excess of the originally underwritten economics in the past year. K&L Gates (UK) and Streets (UK) were retained respectively as legal and tax advisors by Stratos, Osborne Clarke and Gerald Edelman advised Magi.
Gary Fitzgerald, CEO, Stratos said:
“We are delighted to welcome the Magi team into the Stratos family. Magi has accrued an impeccable track record in equity and debt investments on the largest widebodies, delivering consistent profits to its investor base and a particularly strong presence in Korea and the Middle East with both airlines and investors.
“The team’s experience, expertise and capabilities – coupled with our expanded international footprint and new licences – will be pivotal in establishing new industry relationships, securing new deals and ultimately helping us drive Stratos’ next chapter of growth.”
Peter Vardigans, Co-founder and Executive Chairman, Magi Aviation Capital said:
“The Magi team is excited to join Gary and the Stratos team to create a merged entity which will be more than the sum of its parts, building on the two companies’ previous successes in terms of enhanced market coverage, business relationships and specialised experience and skills. Stratos’ rapidly growing and highly regarded lease management and remarketing platform, in combination with Magi’s existing managed portfolio, will provide an even stronger foundation supporting the growth of the combined group’s investor base and airline customers alike.
“We look forward in particular to working with the current Stratos team to continue offering highly professional and creative solutions to our customers old and new.”