Market Intelligence: -Investments and Acquisitions

AAP Aviation is to become the biggest owner of the Pilot Flight Academy (PFA) in Sandefjord, Norway after a group of industrial and financial players have now joined forces to continue one of Europe’s largest and most modern flight schools.

In addition to AAP Aviation, Widerøe is taking a 10 per cent stake in the academy. Viewed overall, this creates a stronger affiliation with the industry and attractive future prospects for students.

“New pilots are much sought-after, and demand will increase further in coming years,” says CEO Espen Høiby at AAP Aviation, who will now be taking over as chair of the PFA.

“The Sandefjord academy has a good reputation, with able instructors, first-class facilities and modern aircraft and simulators. Everything is in place to play a leading role as the market returns.”

Like the rest of the aviation industry, the PFA has been through some demanding years as a result of the Covid-19 pandemic. It has therefore been difficult to utilise its full capacity and the business has run at a loss in recent years. Its equity is consumed, and the students have been concerned about completing their education.

“The PFA’s financial problems have naturally created uncertainty for all 350 of us, who’ve invested both money and time in realising our dream of a future as pilots,” says Robin Aasbjørg, chair of the students’ union at the school.

“We’re incredibly relieved and grateful that new owners are now stepping up to save the PFA. That means we can complete our courses, and that the modern educational programme with its high level of expertise which we’ve had access to is secured for future students.”

In big markets such as the USA, air traffic is now beginning to return to pre-pandemic levels. But aircraft are grounded in America because of pilot shortages, and more countries are eventually expected to experience the same.

Several factors underlie the shortage. First, the average age of pilots internationally is high, and many have retired over the past couple of years. More will follow in the time to come. Second, a number of pilots have opted to switch to flying cargo or private planes.

Four years ago, commercial aviation was expected to double over the next 15 years and an estimated 620 000 new pilots would therefore be needed by 2035. Eighty per cent remain to be trained.

“Although Covid 19 means it will now take rather longer to reach this estimate, the demand for pilots will undoubtedly be substantial,” says Høiby. “We want to help meet a small share of this need by offering a top education to talented people seeking a future in international aviation. Through AAP Aviation, we can offer students an attractive career path.”

The main PFA base is associated with Sandefjord Airport Torp, where a centre has been constructed with first-class teaching facilities and student accommodation. A unit was also established at Notodden in 2018.

To concentrate resources and take care of quality and cost-efficiency, the new owners have decided to close the Notodden branch and focus attention on further developing the PFA’s strong position on the basis of its Sandefjord facility.

Internationally, the school is now represented in America through a partnership agreement with the US Aviation Academy at Denton, Texas. Various options for further international expansion on the basis of an anticipated consolidation in pilot academies are also under consideration.

“Norway needs the educational provision which the PFA represents,” says CEO Stein Nilsen at Widerøe. “By taking an equity stake, we’ll help to continue this provision, increase affiliation with the industry and secure access to new qualified pilots.”

The PFA can accommodate 350 students. Of roughly 80 employees, 60 are highly qualified instructors. Sixteen modern aircraft, both single- and twin-engine, are used in training along with six simulators.

“I’m pleased the owner position has now been clarified, and that the new owners understand our industry,” says CEO Colin Rydon at the PFA. “That’s reassuring both for our students and for those of us who work here.

“We will preserve and further develop our position as one of Europe’s leading pilot schools. At the same time, we’ll carefully assess the opportunities offered for further international growth on the basis of clear requirements for quality and profitability.”

For more information, kindly contact AAP Aviation.

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