FBO Market Sees Strong Interest From Private Equity Funds

Private equity investors have been earnestly searching for yield, and a major investment target garnering interest has been fixed based operators (FBOs).

Michael Wildes

Tuesday, November 23, 2021 at 04:16 PM ET

Verified

Signature Aviation was purchased by a consortium of private equity firms in May. [Courtesy: Signature Aviation]

Key Takeaways:

2021 has been dubbed "the year of the FBO in M&A," with private equity firms making significant acquisitions of Fixed Based Operators (FBOs) to find yield.
Major deals include the $4.7 billion purchase of Signature Aviation by a PE consortium and KKR's $4.47 billion acquisition of Atlantic Aviation, followed by a merger with Ross Aviation.
FBOs are appealing to investors for reasons such as fueling, strategic locations, diverse services, and the opportunity to boost EBITDA through scaling and reducing administrative costs.
This sustained interest, stretching back decades and intensified by increased demand for private travel during the pandemic, is expected to drive further consolidation in the fragmented FBO market.

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Private equity investors have been earnestly searching for yield, and a major investment target garnering interest has been fixed based operators (FBOs).

In May after a bidding war, a consortium of private equity firms—including Blackstone, Global Infrastructure Partners, and Cascade Investments—worked together to purchase Signature Aviation for $4.7 billion from Global Infrastructure Partners. Signature operates the world’s largest FBO network with more than 200 locations globally.