Aviation group headed by ex-Ryanair executive sells for $270m

Stellwagen, the aviation financing group which former Ryanair deputy chief executive Howard Miller joined earlier this year, has been acquired by the Canadian firm Acasta Enterprises for $270 million (€248 million).

Under the deal, Acasta is to commit to investing $100 million in Stellwagen Capital, the company of which Mr Millar is chief executive, over the next three to five years.

The money is the first tranche of a total $1 billion he intends raising for the aviation investment vehicle. “I have other investors that are looking to come in as well,” he said.

Mr Millar intends to lend money to airlines to buy aircraft. The debt will be secured against the aircraft, in a similar fashion to a mortgage. He intends it as an alternative to leasing, which is the more common form of aviation finance.

Regulations due to come into force by the end of the decade will make it more expensive for banks to lend to aircraft lessors, which could force both them and the airlines to seek finance from the capital markets.

Toronto-based Acasta, which was founded by former GE Capital chief executive Michael Neal, is a special-purpose acquisition corporation that raised $402.5 million in an initial public offering of its shares last year.

Earn-out clause

Stellwagen management will have a stake in the business and the deal includes an earn-out clause that could see Acasta paying more than the agreed price, depending on performance.

Mr Millar took up the position of chief operating officer of the overall Stellwagen Group in May. He stepped down as Ryanair's finance chief just over two years ago after nearly 23 years at the airline.

The Stellwagen Group also includes the Dublin based Aviation Finance Company as well as Seraph Aviation Management. Mr Miller also serves as chief executive of Stellwagen Capital, which is the credit investing arm of the group.

“We plan to have $5 billion in assets under management within three years, and believe that Acasta is the right partner to enable us to deliver these targets,” he said.

Mr Miller played a leading role in the development of Ryanair during a period in which it grew from less than a million passengers a year to more than 80 million and was a pivotal figure in many of the airline’s key developments, including its 1997 stock-market launch.