Blackstone is nearing a deal to reacquire Trans Maldivian Airways at nearly the original selling price, eight years after its exit. TMA, the world’s largest seaplane charter operator, faced bankruptcy and debt restructuring due to pandemic impacts. Blackstone’s investment in TMA was previously highly profitable, and while lenders are expecting high valuations, interest from private equity in the volatile sector remains cautious.
Blackstone, the largest private equity firm globally, is nearing a deal to reacquire Trans Maldivian Airways (TMA) at nearly the original selling price, eight years following its $500 million exit. This acquisition appears set to reinstate TMA, the world’s largest seaplane charter operator, back into Blackstone’s portfolio, following turbulent years exacerbated by the pandemic that led to the operator’s bankruptcy and a debt restructuring process.
In 2017, Blackstone exited its investment with a significant profit, realizing a 4.8-fold return on its $98 million investment. The firm sold TMA for $500 million to a consortium led by Bain Capital and Tempus Group. The new owners invested approximately $115-$120 million in debt and equity, attempting to capitalize on high-end tourism in the Maldives. However, the pandemic severely impacted these plans, ultimately leading to Bain and Tempus defaulting on a $305 million loan.
As a result, the company entered bankruptcy proceedings, with lenders such as Carlyle and King Street Capital Management taking control through a debt restructuring. Despite attempts to attract interest from various private equity firms, many remained hesitant due to the volatility of the travel and tourism industry.
Trans Maldivian Airways, which operates a fleet of 65 DHC-6 Twin Otter seaplanes and connects over 80 resorts across the Maldives, reported revenues of $177.9 million in 2024, with expectations of achieving $70-$80 million in EBITDA for the current fiscal year. Although lenders anticipate a valuation of $550-$700 million, potential bidders have expressed reluctance at this price point.
Since its establishment in 1993, TMA has evolved significantly from its initial operations as Hummingbird Island Helicopters, currently conducting over 400 daily flights and catering to more than a million passengers annually. Due to the pandemic, the airline recently shifted from scheduled flights to an on-demand service to adapt to the changing market conditions affected by global public health issues.
In summary, Blackstone is on the verge of reacquiring Trans Maldivian Airways, a major player in the seaplane charter industry, following a complex history of ownership and financial struggles exacerbated by the pandemic. The airline, now under new management after a debt restructuring, aims for recovery as it connects numerous resorts throughout the Maldives. The industry continues to navigate challenges posed by external shocks, yet TMA’s substantial revenue and operational capacity suggest potential for future growth.
Original Source: infra.economictimes.indiatimes.com
