Originally Posted by
Foghorn Leghorn
It’s a good job the likes of Draken and similar companies don’t have boards to please! Makes life easier. I still standby my methodology of leasing something like Gripen, minimal profit generation and then grow the contract. If it doesn’t work, toss the keys back to the lease company. As you point out, the regulatory red tape would be too much for a small detachment to take place. Interesting times ahead for sure. One thing that is apparent, the European and Middle Eastern aggressor market is there for the taking.
The comment about boards isn't entirely true:
ATAC - part of the Textron Systems BU with Scott Stacy (GM ATAC) reporting to Lisa Atherton as Segment and BU lead who in turn reports to the Textron board. Lots of governance but equally lots of political capital, particularly in DC. Bid low on CAF CAS to secure market share and past performance.
Draken - owned by Blackstone within the Tac Opps business portfolio. Both Ford (CEO) and Tart (COO) report to the board of directors who have the power to remove. Again, have shown willingness to invest significant capital if the recent MLU acquisition is anything to go by.
Top Aces - owned by Clairvest, part of CEP IV whose board Bouchard (CEO) and Toussaint (COO) report too. Clairvest CEO (Ken Rotman) is chairman of the Board. This is how they raised the multiple-hatted $100MM capital to drawdown on for items such as Netz, A-4N modernisation etc.
Tactical Air Support - both Oaktree Capital Management and Meta Aerospace Capital have been involved in funding the acquisition and modernisation of their F-5AT effort. There is a board and all investments need to be approved by it. Shown a willingness to pursue a loss-lead strategy to gain market access, contrast Fallon versus Kingsley Field.
Leasing isn't really an option either unless governments are willing to set realistic budgets for a service provision; for instance a G2PE dry lease arrangement for something like the M-346FA is iro $20,000-$25,000 per hour. Add on gas, overheads, profit etc and you can add somewhat more to that figure.
The European market is certainly expanding and they have a common sense way forward especially regards to certification, air worthiness and mutual recognition thereof. The Middle East is descending into what can best be described as a pissing match between KSA and UAE. For sure, they've got the cash but are they actually willing to pursue the notion especially given the nonsense of Procor......