China Minsheng Investment Corp’s 33% stake in Luxaviation made possible the acquisition last year of ExecuJet Aviation Group, forming the world’s second largest corporate aircraft operator after NetJets. Now Luxaviation Group plans a further spate of acquisitions.

Luxaviation acquisitions are “absolutely continuing,” confirms Group CEO Patrick Hansen. “We’re currently looking at three deals, and none are European targets.” He won’t be drawn further but adds, “All I can say is that they’re all profitable. Right now we have a team working on another deal which hopefully will be closed in the coming weeks.”

The Chinese investment in Luxaviation doesn’t signal any aspirations for that market, says Hansen. “Let’s look at the reality: CMI acquired BAA (Business Aviation Asia) and they’re already in China, so it would be completely unjustifiable competing with each other – it is their home market. So why should I go into a market where I have to compete with my cousin?”

A CMI/Luxaviation joint press release from April 2015 noted that “General aviation is a vital segment of CMI's development, and in November 2014, CMI acquired 61.25% of the shares in Minsheng International Jet which has become one of the largest business jet management operators after wholly acquiring Asia United Business Aviation Limited.” Despite its name, CMI is not linked to the Chinese business jet powerhouse Minsheng Financial Leasing Co.

Hansen says he is constantly on the lookout for opportunities. “It will depend on the size of our company, the state of the market, and I do not know when we will finish,” he says.

He notes that a lot of companies are currently suffering in Europe. “I always say I’m not going to buy a problem, especially if it’s a problem where you don’t have huge growth opportunity. In Asia it’s different. You can buy a problem company as it’s not necessarily a problem when it comes to the future.”

Luxaviation and CMI Group’s integration is almost complete, says Hansen. “We’re on the last stretch, but there is always more integration that we can do.” Nothing goes as smoothly as it does on paper and he says that some of the synergies that management predicted are perhaps running three to five months late. Some IT work continues within the Belgian company formally known as Abelag which became part of the Luxaviation Group in 2013.

“If someone told me five years ago that we would be the size we are now I wouldn’t have believed them,” says Hansen. When asked if he’d made any changes to the original business plan, he said that it depends on which plan you look at. “Even two years ago we had not expected that we would be able to get our hands on ExecuJet… even though I’d been working on it for quite a while. When ExecuJet came through, it of course changed some of the issues that we had. If we hadn’t got ExecuJet and had gone for something smaller then the integration process would have been handled differently. Now we’ve got ExecuJet we do everything off the ExecuJet platform. Two years ago this was simply unforeseen.”

Luxaviation’s managed aircraft fleet has grown to 262, thus maintaining its position as the world’s second largest operator behind NetJets. “We have a sales team that has a much better argument than anyone has had before – we have the advantage of size, purchasing power and aircraft availability,” Hansen says.

“Not many companies can argue with that.”

 

Luxaviation’s Recent Acquisitions

So far this year Luxaviation CMI has acquired two companies and successfully won a bid in India to build an FBO/MRO operation.

In January it acquired European Business Aviation Services’ FBO and ground handling services at Munich International (the biggest handling area at Munich’s GA terminal), thus making it the 21st FBO in its EMEA, Africa and Australasian network. All are operated under the ExecuJet brand.

In February the company, with Indian partner The Bird Group, won one of the two licenses to build and operate a new FBO and MRO facility at Indira Gandhi International Airport in New Delhi.

In April the company will extend various licensing activities in Mexico. In the meantime it has opened its first FBO there, to be operated under the ExecuJet brand at Del Norte International in Monterrey. ExecuJet Mexico has been operating since 2002 and already has offices in Monterrey and Toluca with 13 aircraft under management.