DUBLIN-BASED executive jet airline JetBird has sold a 9.3 per cent stake in the business to a Saudi family for €10 million in a move that now values the company at more than €100 million.
The fledgling airline has also secured debt financing of $10 million (€6.9 million) from Royal Bank of Scotland for the pre-delivery payments on its first 25 Phenom aircraft from Brazilian manufacturer Embraer.
This will be seen as something of a coup given the current clampdown on lending in financial markets. When contacted, JetBird chairman Dómhnal Slattery declined to give the identity of the Saudi investor, except to say that it was a family-owned group with interests in hotels, construction and financial services. It is understood that the investors are not part of the Saudi royal family and do not have oil interests.
JetBird is believed to be in discussions with the Saudi investors about the possibility of launching a similar venture in the Middle East over the next three to five years. This would operate as a joint venture. The Saudi investors are expected to appoint a representative to JetBird's board in the coming weeks. JetBird, which plans to offer low-cost executive travel between the main European financial centres, has raised €31 million in cash to date.
The airline plans to launch in the summer of 2009 and has chosen Cologne in Germany as its first base. JetBird plans to pitch its prices at up to 50 per cent below current operators in the executive jet market.
The proceeds are expected to be used to finance the expansion of JetBird's fleet and for general corporate purposes. JetBird has so far placed firm orders for 53 Phenoms and has options on another 47 aircraft.
The latest equity placing has diluted other shareholders in the airline. Mr Slattery will now own 41 per cent of the company with Claret Capital, the private equity group he controls, owning about 35 per cent. Mr Slattery said JetBird would take delivery from Embraer of its first aircraft in April. "Our focus at the moment is on Germany being our first market."
JetBird has been slowly building its executive management team in Dublin over the past year or so. The company is led by Stefan Vilner, an experienced Danish airline executive.
