European Cargo (SE, Bournemouth) says it closed a "significant" minority equity investment with Priority 1 Logistics Holdings LLC, a newly formed subsidiary of US-based Priority 1 Holdings LLC, on February 22, 2022. Neither the size of the stake nor its value were disclosed.
The UK-based cargo carrier did note that proceeds from the investment will be used to eliminate third-party debt, convert its A340 fleet to full cargo freighters, acquire additional aircraft, complete heavy maintenance checks, and for shareholder dividends.
"This is a major step forward in the growth of European Cargo," Paul Stoddart, the chairman of ECL, commented. "We have positioned our airline to provide our valued freight customers with a reliable air bridge to meet the increasing demand for air freight. The investment by Priority 1 into ECL will help us continue to build a sustainable, successful and profitable business following one of the most difficult periods in aviation history due to the Covid pandemic. This partnership with Priority 1 provides us with additional financial resources as well as deep commercial aviation expertise which will increase our capacity and ensure that we meet our rapidly accelerating customer demands."
Priority 1 Holdings is a diversified international aerospace and defense company headquartered in Tysons Corner, Virginia. The capital used for its investment in European Cargo came from funds managed by Blackrock Financial Management Inc., which recently provided Priority 1 with a senior debt facility to refinance existing debt and grow its aviation-based platform.
NatAlliance Securities, LLC acted as advisor to Priority 1 Logistics for both the senior debt capital raise and its investment in European Cargo.
For its part, European Cargo is a subsidiary of European Aviation and operates three passenger-freighter-configured A340-600s on scheduled flights connecting Fuzhou and New York JFK via its Bournemouth hub. It also offers charters to various points throughout the world.
