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TPG takes stake in Brazil’s Azul

An investment arm of Texas Pacific Group (TPG) has taken a stake in Brazilian carrier Azul chaired by JetBlue founder David Neeleman.

During a 22 January television interview with CNBC, Neeleman said TPG's stake was roughly $30 million. The new investment by TPG was facilitated by two other Azul investors, Pequot Capital and Wexford Capital, selling shares. Pequot still has a stake in the carrier.

"The Brazilian market is growing rapidly, as is the popularity of Azul," says TPG partner Rick Schifter. "We believe this will continue to be an amazing success story."

Neeleman during the interview stressed Azul was cash flow positive, and has "plenty of money".

But he did say Azul is financing "a lot of airplanes this year", and "there's a lot of companies that wouldn't touch us with a ten foot pole last year that are jumping in and bidding on planes".

The Flightglobal ACAS fleet database shows Azul currently operates 14 aircraft split between nine Embraer E-190s and five E-195s. The carrier has 28 E-Jets on order - two E-190s and 26 E-195s.

In October 2009 Neeleman told ATI Azul expected to take delivery of seven aircraft in 2010 followed by 12 E-Jets in 2011.

At that time Neeleman also said an initial public offering was part of the long-term plan for Azul, but no set time period existed to take the carrier public.

"We'll probably do an IPO," said Neeleman. "We've got a good exit strategy for our investors."

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