With BBA Aviation’s purchase of privately held industry fuel supplier Epic Aviation completed in July, this year’s NBAA convention marks the first time Epic and Signature Flight Support will exhibit under the same banner. The two are occupying adjoining booths (1600, 2000). The $88.1 million deal announced before EBACE in May encountered no regulatory hurdles, according to Mark Johnstone, who was promoted from president and CEO of BBA’s engine repair and overhaul division to group chief executive and Signature CEO in April.
In the time since the deal was consummated, the company has maintained Epic as a separate business within its portfolio, with Kevin Cox remaining president.
Signature operates the world’s largest FBO network with more than 200 locations, including 19 licensed Signature Select facilities globally, and Epic brings its own branded network of approximately 200 FBOs, plus nearly 100 more unbranded facilities. “We don’t control them, we don’t control the leases, nor do we control the pricing,” explained Johnstone, “so I think it's very clear in my mind that we need to make sure that there is customer clarity between the two [networks]."
Yet, going forward, the company will look to leverage its newly expanded influence, through cross-promotion between the two separate networks. “You have a bunch of independent operators that pride themselves on their independence,” said Cox, referring to the Epic member FBOs, ”but who are also looking to put more tails on the tarmac and deliver more customers to their bottom line, and that’s obviously what Signature can bring to these Epic FBO owners.” Here at the show, Johnstone will host a welcome reception and question-and-answer session for Epic’s network-member FBOs.
“When you look at our network today, before Epic, you would find Signature at seven out of 10 of the top destinations business and general aviation flights fly to,” said Johnstone, describing that as his definition of customer relevance. “Anything we do in the M&A space, whether it's Epic or acquiring other FBOs is all about becoming more relevant to our customers so we can effectively meet their needs at both ends of their journey.”
One of the most obvious benefits to the deal lies in economies of scale. “Signature procured over 300 million gallons of jet fuel last year,” Johnstone told AIN, “Epic another 200 million-plus, so you put those two together it gives us a lot bigger purchasing power both from the fuel providers, but ultimately direct from the refineries.” He noted that this will allow the company to better control fuel costs not only in the Signature FBO network but also for Epic’s members.
"I think one of the things that would benefit the [Epic} branded dealers is having the opportunity, should they wish, to transition into a Signature Select and really have the full portfolio of support that Signature offers to those licensed locations," added Patrick Sniffen, Signature's vice president of marketing.
The purchase also expands the existing relationship between the two companies, which saw the development of the Epic/Signature Multi-Service Aviation Card. It is accepted for payment at more than 8,000 locations worldwide, through U.S. Bank’s Multi-Service Aviation Network.
Along with the Epic purchase, BBA acquired the fueler’s QT Pod (petroleum on demand) subsidiary, which produces self-serve avgas fueling systems. The largest distributor of such devices, the company currently has more than 1,600 of its M3000 fuel dispensers in service as it ramps up deliveries on its new M4000, which was launched in February at NBAA’s Schedulers and Dispatchers Conference. “That is a cloud-based system that basically allows anybody to pull their aircraft up and self-serve for just the price of fuel,” said Cox, adding the product has generated a good amount of interest from FBOs and airports. “We’ve already seen some 220 M4000s ship out in just the last few months.”
In addition to Johnstone’s replacement of Simon Pryce and then interim CEO Wayne Edmunds as BBA’s overall head, the company has made several other recent executive changes. Tony Lefebvre, who previously headed up BBA’s former ASIG commercial aviation ground handling division and also runs the company’s global engine services division, was named as Signature’s president and COO, succeeding Maria Sastre, who held those positions until her departure in at the end of April. Joining the FBO operator as chief commercial officer is former U.S. naval aviator Shawn Hall. For the past decade, he served as a consultant with McKinsey and Co, advising the aviation and hospitality industries. All three will be at the company’s booth during the show.