Jet Edge, one of the largest private aviation operators, has received a total of $190m in funding from KKR and is adding 27 Bombardier Challenger 300/350 and Gulfstream G450 aircraft to its fleet.
New Funding
KKR (NYSE: KKR), a leading global investment firm headquartered in New York, has provided two rounds of funding to Jet Edge over the last few months. The first was a credit facility of up to $150 million, followed by an agreement to invest $40 million in preferred equity in Ohio based Jet Edge International.
“We are pleased to invest in the growth of Jet Edge as a premier scaled private aviation operator with a leading membership program and world-class super-mid and large cabin fleet,” said Dan Pietrzak, Partner at KKR. “At a time when the private aviation industry is experiencing historically high demand, the Jet Edge team continues to impress us with its innovative solutions to age-old inefficiencies and strong operational execution.”
Jet Edge says the funding will be used to support the acceleration of the Company’s broad infrastructure, digital initiatives, Reserve membership, and comes as Jet Edge rolls out its AdvantEdge charter management platform nationwide.
“We will continue to invest heavily in technology and back-end infrastructure to enhance the customer experience and help us stay ahead of evolving client demands amid rapid membership growth. This financing speaks to KKR’s continued confidence in our business plan to deliver scaled private aviation solutions and we look forward to being able to provide even more clients unique access to our industry leading fleet across all major markets in the United States,” said Bill Papariella, CEO of Jet Edge.
New Aircraft
The company is adding sixteen Bombardier Challenger 300/350 and eleven Gulfstream G450 aircraft, which will all be flying by the end of the year, bringing the total available aircraft for charter in the AdvantEdge fleet to 74, made up of 38 Challengers and 36 Gulfstreams. The new additions will have an average age of less than 10 years old and will include new paint, interiors, and upgraded state of the art cabin technology systems. Jet Edge says the cabins will include Gogo 4G streaming Wi-Fi, Bluetooth controlled sound systems, updated USB charging ports, HD Airshow, in-flight entertainment options, and more. The new deliveries started in earnest in July of this year and will be delivered in their entirety by December 15th.
CEO Bill Papariella commented “As many private jet travelers face waitlists, halted fractional sales, and phased out aircraft product offerings, Jet Edge is providing access to these state-of the-art Challenger and Gulfstream models before year end.”
Growth
For aircraft owners, Jet Edge has developed the AdvantEdge Program, which aims to make ownership more financially predictable, particularly for owners who want to make their aircraft available for charter. Jet Edge says the program includes revenue management, pricing, scheduling, and logistics which combine to deliver consistent revenue, lower fixed costs, and reliable schedules for aircraft crews.
Owners receive a full cash flow/depreciation analysis to help them find the right balance between charter revenue, fixed-cost reduction, and long-term aircraft value. For those owners that want to charter out their aircraft, Jet Edge asks them for time commitment starting at 14 weeks up to 52 weeks annually, representing program revenue blocks from 250 to 900 hours. Jet Edge will supply charter demand for the time the aircraft has entered the program.
The 2020 numbers from ARGUS show Jet Edge is one of the largest charter operators in the USA.
On the other side of this equation, for frequent charter flyers, Jet Edge offers the “Reserve Membership.” This provides priority access to Jet Edge’s fleet of aircraft, streamlining the chartering process and providing simplicity and flexibility to these frequent private jet flyers. Members have access to bonus flight credits, catering, empty leg discounts and elite benefits through Jet Edge’s global partnerships with Montage International, Discovery Land Company, and Four Seasons Hawaii Collection. Jet Edge says it has seen significant new member acquisitions over the past 12 months and has recorded over $100 million in membership deposits over this period.
“We’ve successfully executed numerous growth initiatives driven by KKR’s initial financing and are excited to continue to build our platform with this new investment,” said Bill Papariella.