Bristow Acquires 42.5% of Lider, Brazil's Largest Helicopter Services Company





Bristow Acquires 42.5% of Lider, Brazil's Largest Helicopter Services Company

By Dana Murphy


HOUSTON, May 28, 2009 Bristow Group Inc. has acquired 42.5% of Lider Aviacao Holding S.A. 'Lider', Brazil's largest provider of helicopter and executive aviation services.

Founded in 1958, Lider operates the largest helicopter fleet in Brazil, with 46 helicopters serving the oil and gas industry, representing approximately 50% of the oil and gas market in Brazil. Its helicopter operation is the most profitable business segment and has been growing revenues at a compounded annual rate of over 22% in the past three years. Lider's fleet has 46 helicopters and 29 charter aircraft. At December 31, 2008, there were approximately 1,480 employees. Lider generated approximately $305 million in revenue and $33 million in Adjusted EBITDA in 2008 and $12.5 million in Adjusted EBITDA in the March 31, 2009 quarter on $60 million in revenue. Adjusted EBITDA.

William E. Chiles, Bristow Group President and Chief Executive Officer reported the company views Brazil as the next 'North Sea' in terms of its potential for growth in offshore services requirements. This investment in Lider represents the most attractive entry point into a new market that is a critical part of their long-term growth strategy. In addition to earnings from their investment, the company will be leasing aircraft to Lider in response to the demand for new helicopters.

The company further reports that Brazilian offshore deepwater market is thriving as a result of several world-class oil discoveries and government funding initiatives to develop those discoveries. The company's objective is to be a leader in each market they serve and equity ownership investment in Lider gives Bristow a solid position in this very important market.

Concurrent with the acquisition of the 42.5% interest in Lider at a purchase at a price of $174 million, Lider purchased one large and four medium aircraft from the company valued at approximately $55 million, resulting in a net cash outlay by Bristow of $119 million. Additionally, the terms of the purchase agreement include incremental earn-out payments based on the achievements of clearly defined annual and/or cumulative EBITDA growth targets over the next three years. If fully earned, these payments would total up to $53 million and would imply an enterprise value to EBITDA multiple of approximately 7X for 2009-2011. For the next five years, Bristow will have the right to provide 100% of Lider's helicopter lease requirements as well as the right to lease 50% of Lider's total medium and large helicopter requirements that Lider would otherwise fulfill through the purchase or finance lease of helicopters.

Bristow Group is already a leading provider of helicopter services in the North Sea, Gulf of Mexico, Nigeria and Australia, and the investment in Lider will give us a strong foothold in a fifth major market that is a key part of our long-term growth strategy," Chiles said. "Lider is the premier integrated aviation company in Brazil, with a strong customer base in the offshore oil and gas industry, including Petrobras, Shell, Chevron, StatOilHydro, British Gas, Repsol and Anadarko. Its strong relationships with these customers provide Bristow with an advantage in Brazil and the opportunity to partner with one of the most important national oil companies in the world.

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