“So You’re Buying an Aviation Company….”

We would like to thank those of you who were able to join our fifth annual Aviation roundtable.  The discussions were frank, informative and fun.  For those of you who could not make it, we will be providing the materials for each roundtable on a weekly basis.  Our first roundtable topic was: So, You’re Buying an Aviation Company – Merger and Acquisition Issues in the Aviation Industry. 

Aviation transactions require a level of due diligence that goes well beyond traditional corporate, financial, and commercial review. The aviation industry is heavily regulated, and a transaction that changes ownership, management, corporate structure, or operations can have significant FAA and DOT implications. This places a heavy burden on buyers to evaluate the target company’s certificates and authorizations.  Mergers raise questions regarding citizenship and economic fitness that can make the buyer ineligible to hold the target company’s certificates. 

In addition, depending on the transaction structure, an asset purchase, stock purchase, merger, or other change in control may produce very different regulatory consequences. Due diligence should also address whether operations can be relocated, whether FAA or DOT notification or approval is required, and whether changes to principal officers, accountable managers, or other key personnel could affect existing authorizations.

For more detail on this topic based on whether the target is an air carrier, charter operator, repair station, or simply owns aircraft, see the RoundTable PowerPoint which can be found HERE.