Air T Secures $4 Million Investment to Fuel Expansion of Mountain Air Cargo and Lease Operations

Air T, the aviation holding company, has successfully raised $4 million through trust preferred securities, earmarked to bolster the working capital of its subsidiary, Mountain Air Cargo (MTN, Kinston). This injection of capital comes as Mountain Air Cargo, a dedicated cargo specialist primarily operating on behalf of FedEx, significantly expanded its fleet in 2023 by adding thirteen aircraft, including Cessna 408Fs, ATR72-600Fs, and ATR72-200(F).

The substantial fleet expansion, nearly doubling the carrier’s total aircraft to 32, necessitated additional working capital to support ongoing operations. The funds raised will not only support Mountain Air Cargo’s growth but will also be directed towards expanding Air T’s aircraft and engine lease businesses. Additionally, the investment will contribute to enhancing the MRO (Maintenance, Repair, and Overhaul) capabilities of Worldwide Aviation Services, a recently acquired subsidiary, and support the ground equipment manufacturing arm, Global Ground Support.

Air T, as a holding company, owns and operates various subsidiaries independently, including lessor Contrail, cargo carrier CSA Air, and several other entities. The latest financial reports indicate that in the nine-month period ending September 30, 2023, Air T posted an adjusted EBITDA profit of $1.5 billion, with a significant portion of its operating revenues derived from overnight cargo services.

The trust preferred securities issued by Air T carry a 12.1% interest rate to maturity. Buyers of these securities also have options to purchase an additional $4 million worth of securities under the same terms. Air T indicated that it may consider offering more securities in the near future, as part of its strategic approach to funding expansion initiatives across its diverse portfolio of aviation businesses.