Loftleidir Icelandic acquire 55% share in Latvian charter operator Latcharter
The acquisition comes as a result of the ongoing cooperation between the two companies announced earlier this year and is part of Loftleidir Icelandic strategy to strengthen its position in the Baltic and CIS region as well as adding the Airbus family into its worldwide ACMI product line.
When prompted about the acquisition Sigthor Einarsson, managing director of Loftleidir Icelandic said; "LatCharter Airlines has built up a solid and positive reputation in the Baltic region and has close relations to the local charter market. Furthermore the company has gained extensive knowledge of the CIS market which we will undoubtedly benefit from in the near future, opening the window for our current product line".
The Latcharter operation will complement Loftleidir Icelandic´s current product line, which operates under the Icelandair AOC, a JAA approved airline with an AOC in compliance with JAR OPS 1. Loftleidir Icelandic currently wet leases four Boeing 757-200 and two Boeing 767-300 aircraft to customers in South- and North-America, Europe and in The Middle East. Its past & current wet-lease customers include airlines like TUI Group, British Midland, Blueline, NEOS, LOT and White, and tour operators like Starquest Expeditions in the USA, Krone Rejser of Denmark, CT2 of the UK and GWV in the USA.
Latcharter Airlines was established in Latvia in 1992. The company started its operations with several Soviet built aircraft but gradually changed its fleet to two modern Airbus-A320 aircraft. By 2006 the company has grown substantially in the number of passengers carried and by the number of destinations and has become the leading provider of charter flights in Latvia. Meanwhile the company has also started to offer wet-lease services outside of Latvia. In 2005, the company carried 100,000 passengers and its turnover reached 17 mio EUR (up from 13 million EUR in 2004). Currently Latcharter Airlines employs 87 people.
To facilitate the aggressive and profitable growth of the company even further, the shareholders of Latcharter Airlines decided to team up with a strong strategic investor. As a result of this process, the company has become a part of a large aviation company Loftleidir Icelandic / Icelandair Group. The connection to a large airline partner will enable the company to grow in a quick and profitable way.
The CEO of Latcharter Airlines says: "Using the fleet of the new partner, LatCharter Airlines will enable Baltic tourists to travel directly to the resorts of Central America and Indian Ocean region. The possibility to mix the aircraft fleet will allow both Latcharter Airlines and Loftleidir Icelandaic to advance in the airline business as well as take the advantage of more profitable wet-lease opportunities."
The buyers were advised in this transaction by Behrens Corporate Finance. Behrens Corporate Finance is a Nordic and Baltic based advisory firm assisting Nordic investors in the Baltic countries.
Leading Baltic investment bank Lõhmus, Haavel & Viisemann (LHV) were advisors to the shareholders of Latchater Airlines in this transaction.