European Cargo announces investment to convert A340 fleet to cargo freighters

European Cargo Limited has closed a minority equity investment that will be partly used for converting the company’s A340 fleet to full cargo freighters.

The minority equity investment has been made by Priority 1 Logistics Holdings LLC, a newly-formed subsidiary of US-based, Priority 1 Holdings LLC.

Proceeds of the investment will also be used to eliminate third-party debt, acquire additional aircraft, complete heavy maintenance checks, and for shareholder dividends.

Paul Stoddart, chairman of European Cargo, commented: “This is a major step forward in the growth of European Cargo. We have positioned our airline to provide our valued freight customers with a reliable air bridge to meet the increasing demand for air freight.”

European Cargo, part of European Aviation Group, operates a fleet of Airbus A340 long-haul aircraft at Bournemouth Airport in the UK.

Douglas Brennan, executive chairman of Priority 1, commented: “Expanding Priority 1’s business into the cargo market represents a very exciting opportunity given the outsized demand for reliable air freighters due to strong trends in the marketplace, including the growing importance of e-commerce and reliable delivery of PPE to the world at large. Paul Stoddart and his skilled team at ECL have built enormous aviation capabilities and, together, we will help fuel the growth of ECL to build a powerful global cargo operator.”

Capital for the ECL investment was provided by 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 platform.

NatAlliance Securities, LLC acted as advisor to Priority 1 Logistics Holdings for both the senior debt capital raise and its investment in ECL.

Rebecca Jeffrey www.aircargonews.net