Sanad Aero Solutions, Mubadala's aircraft engine and components financing and leasing company, has grown its assets under management by more than 50 per cent to US$700 million in the past 18 months as global demand builds for spare parts.
The latest chapter in the company's expansion emerged yesterday when it announced its partnership with Abu Dhabi National Leasing (ADNL), the wholly owned lease financing arm of National Bank of Abu Dhabi, had reached more than $400m in sales. The two companies have worked together on components and financing deals for a number of airlines, most recently Etihad Airways.
"Expanding our relationship with ADNL through this transaction is evidence of our ongoing commitment to growing the spares capacity and our shared ambition to expand locally and globally," said Troy Lambeth, the chief executive of Sanad. "The relationship continues to strengthen our capacity to serve a rapidly growing global spares market." Incorporated in late 2009, Sanad's aim has been meeting the emerging need for spare parts and funding for a cash-constrained aviation industry and also to feed into Abu Dhabi's aim to become a global centre for the aerospace industry.
In addition to Etihad, Sanad counts Virgin Australia and airberlin, both of which Etihad has stakes in, as well as flydubai, Aeromexico and Onur Air among its customers.
The company's assets under management had reached about $700m, up by more than 50 per cent from late 2011, said Mr Lambeth.
In the next decade, an estimated 10,000 new aircraft will take to the skies. They will require about $15 billion in spare parts, estimates Sanad. "One of the trends we're seeing is that airlines are being forced to get leaner and the cost of spare parts can be a burden, which means more airlines are looking to third-party solutions," said Mr Lambeth.
"We launched Sanad to address the growing need in the market. There's a lot of companies supplying aircraft financing but fewer focusing on engines and even fewer on components."
Sanad's work dovetails with Mubadala Aerospace's maintenance, service, repair and overhaul service providers, SR Technics and Abu Dhabi Aircraft Technologies.
For example, in May Sanad and SR Technics both signed a 10-year component services contract with Aeromexico to cover the airline's Boeing 787 Dreamliner fleet of 19 aircraft.