CALC to take 35.68% equity interest in TransNusa owner for USD28m

China Aircraft Leasing Group (CALC) announced (05-Mar-2020) it will invest in PT TransNusa Aviation Mandiri (TAM), through a subscription agreement with Aviation Synergy Limited (Aviation Synergy). CALC has agreed to indirectly invest and acquire a 35.68% equity interest in TAM for a total cash consideration of USD28 million at completion. TAM is an Indonesian airline operating company, which operates TransNusa. CALC stated this is a "significant move" to expand its downstream footprint to cover the entire aviation value chain, aligning the Group's business strategy in combining vertical integration and horizontal expansion. The investment in TAM gives CALC a "first-mover to expand its full-value chain business model into the ultimate end-user of the aviation value chain", and allows it further exploit the synergy in the "manufacturer-lessor-airlines" ecosystem. CALC stated the competitive advantage would enable it to capture value at every point of an aircraft life cycle, including that for the Chinese-manufactured aircraft. The strengthened aviation value chain also paves the way for the CALC to launch more aviation-related funds, including CNY denominated aviation funds, to support future business expansion with more efficient turnover of its capital leveraging its "asset-light" model. [more - original PR]