Seabury Group this week launched a merchant banking division to invest in the aviation, aerospace, defense and transportation sectors. The main focus for New York-based Seabury Corporate Finance LLC will be minority equity investing, private label commercial aircraft leasing and private debt financing. The new company will also include Seabury's involvement as an advisor on aerospace and defense mergers and acquistions, as well as its structured finance and maritime corporate finance activities.
“For 20 years we have been involved [on an advisory basis] in areas such as airline restructuring and aerospace mergers and acquisitions, for which we’ve made investments on behalf of clients, but now we are investing side-by-side with them and effectively putting our money where our mouth is,” Seabury Corporate Finance managing director Patrick Dowling told AIN.
Seabury is not looking to take majority control of the companies it invests in and Dowling explained that it will have a different strategy than private equity groups, which often look to get a relatively short-term return on their investment by reselling companies or divesting corporate assets. “We’re investing for long-term growth,” explained Dowling, who added that in some cases this might involve existing clients.
In the commercial aircraft-leasing sector, Seabury aims to build a portfolio of mid- to end-of-life aircraft, giving investors a way to buy into this sector without having to manage the assets themselves. “This is a relatively unexploited leasing sector with attractive economics and high yields,” said Dowling.
In the private debt financing sector, the new merchant banking unit of the 20-year-old global advisory and professional services group sees opportunities to finance lower- to middle-market companies, including aerospace and defense manufacturers, suppliers and service providers. In some cases this will involve club transactions (with investments pooled), or providing senior debt or restructuring arrangements for clients.
“Seabury’s moving into merchant banking is a natural fit as it builds on deep and extensive knowledge of a highly adept and experienced team of industry experts,” said Seabury Advisory Group president and CEO Christopher Kubasik. Patrick Dowling recently joined Seabury after holding senior positions with Massif Partners, Tygris Leveraged Finance Transportation and GE Capital.