Leasing company Dubai Aerospace Enterprise is looking to further expand its portfolio prior to 2010, when it takes delivery of its first ordered aircraft.
In November DAE signed deals acquiring 20 aircraft from GECAS and eight aircraft from Emirates, in addition to placing orders directly with Airbus and Boeing for 100 aircraft each. DAE Capital chief executive Robert Genise (pictured) says DAE is now aiming to acquire another 30 to 35 aircraft in 2008 and 2009 through a mix of transactions, including asset purchases and sale leasebacks.
Several sale and leaseback deals similar to the deal it has done with Emirates are possible, he says, adding: "We're in talks with a number of airlines for opportunities for this year."
Genise says DAE is also in talks with owners of aircraft assets and could complete more deals similar to the one it has done with GECAS.
He says five of the eight Emirates aircraft and 13 of the 20 GECAS aircraft were transferred to DAE's books in December. "The remaining three Emirates planes will be transferred in January [and] the remainder from GECAS will transfer immediately thereafter," Genise says.
The 18 aircraft that were transferred to DAE's books in December are not included in the Airline Business top 50 survey because the cut-off date for the survey is the beginning of December. The 18 aircraft are valued at about $750 million, according to ACAS figures. This would already make DAE the 21st biggest leasing company.
DAE expects to have a portfolio valued at more than $5 billion by the end of 2012, which would make it the world's eighth largest leasing company.
All eight of the Emirates aircraft are Airbus A330-200s. DAE says the five that were transferred onto its books by the end of December include two that were built in 2000, two in 1999 and one in 1998.
The GECAS deal includes several model types leased to a mix of carriers. The 13 that have already been transferred to DAE include three Airbus A319s that were built in 2005, four A319s from 2006, one A319 from 2007, two A320s from 2006, two Boeing 737-700s from 2007 and one 737-800 from 2006.
DAE says the 13 GECAS aircraft are leased to seven different carriers but it declines to reveal which carriers these are.
The GECAS and Emirates deals, as well as the additional transactions planned for the short-term, will give DAE a revenue stream before the first of the 100 aircraft it has ordered from Boeing is delivered in 2010. The first Airbus aircraft will not be delivered until 2013.
Genise adds that from 2012 DAE plans to grow its portfolio by about 35% per annum.
When Genise joined DAE in April he said DAE would have a portfolio of $5 billion by end of 2012. Given the orders it placed in November and the roughly 60 aircraft it expects to have in its fleet by the end of 2009, Genise now says: "I'm sure we'll be more than $5 billion in 2012."
Genise says carriers have already started contacting DAE to express interest in leasing some of its ordered aircraft, in particular the 737s slated for delivery in 2010, although DAE was not planning to secure commitments so early.
"We've been approached by some carriers," he says. "I wouldn't be surprised if we place a few of these aircraft this year."
DAE Capital now has a team of 11 people. Genise plans to hire a "few" more sales and accounting employees this year.
"That will take care of us for the foreseeable future," he says. "We will keep it very lean."
Source: Airline Business