Blackstone, the world’s largest private equity fund, is reported to be in the closing stages of reinvesting $500 million and taking a controlling share in Trans Maldivian Airways (TMA), the world’s largest seaplane operator. The move comes eight years after the company sold its majority shareholding in TMA to a consortium that includes Bain Capital (majority owner of Virgin Australia) and Chinese conglomerate Shenzhen Tempus Global Business Services Holdings. Blackstone previously owned Trans Maldivian Airways between 2013 and 2017.
According to a report published by the Economic Times of India, Blackstone is on track to buy back the seaplane operator at almost the same price it sold it, according to inside sources. In 2017, Blackstone exited TMA, which was its largest divestment in the Asia region at the time. The company sold its initial $98 million investment in TMA for $500 million to the Bain-led consortium.
Bain had been attracted to the niche operator at the peak of the tourism and luxury travel market in the Maldives. TMA’s specialization is transferring high-end tourists from the seaplane base at Male-Velana International Airport (MLE) to the outlying islands of the Maldives, an archipelago of over 1,000 islands. However, Bain’s hopes to cash in on high-end leisure travellers flocking from Asia and Europe to the Maldives collapsed as the COVID-19 pandemic took hold and effectively killed off long-haul travel for around two years.
When Bain and its Chinese partners defaulted on a $305 million loan taken out to purchase TMA, the company’s lenders took control of the business, relying on securities clauses within the loan agreement to do so. Subsequent debt restructuring saw a new lender consortium led by Carlyle Group take control of the operator as it weathered the storm caused by the global health crisis. While the current owners had been reportedly hoping to sell for a figure closer to $700 million, they may be happy to settle for the $500 being offered by Blackstone in what is now seen as a market highly volatile to external world events.
With Blackstone now poised to once again take the helm of the airline, the investment process appears to have come full circle, with the deal all but completed, said the sources. Tourism to the Maldives has now fully recovered, with increasing numbers of tourists arriving on a growing number of carriers serving Male International Airport.
According to ch-aviation, Trans Maldivian Airways is the world’s largest amphibious aircraft operator and also the largest operator of De Havilland Canada DHC-6 Twin Otter seaplanes. The airline currently operates 59 DHC-6-300s, three DHC-6-400s, two DHC-6-200s, and a single DHC-6-100. The airline was merged with fellow seaplane operator Maldivian Air Taxi in 2013, which was also owned by Blackstone at the time. Today, the combined carrier competes with Manta Air and Maldivian on inter-island air services around the Maldives.
