Boullioun faces third change of ownership in six years

German bank to sell aircraft lessor but retain stake in profitable Singapore company

German bank WestLB is offering wholly-owned aircraft lessor Boullioun Aviation Services for sale, but has decided to retain Boullion's 35.5% stake in Singapore Aircraft Leasing Enterprise (SALE).

WestLB says it is hoping to dispose of its stake in Boullioun as part of a restructuring plan intended to shift focus away from non-core activities and more on to the European banking sector.

If WestLB finds a buyer before the end of 2004, it will be the third ownership change for Boullioun in six years.

WestLB acquired the Seattle-based lessor only in 2001 from Deutsche Bank, which itself acquired the company from Sumitomo Trust and Banking in December 1998.

WestLB will retain a presence in the operating leasing sector by keeping its stake in profitable Singapore-based SALE, which has its own portfolio of 60 aircraft. WestLB is also involved in aircraft financing.

Boullioun set up SALE with Singapore Airlines (SIA) in 1993. WestLB took an indirect shareholding after it acquired full ownership of Boullioun, but last week SALE's board approved the transfer by WestLB of Boullioun's 35.5% to itself. WestLB says it sees good potential in SALE.

"The transfer of ownership reflects a decision by the bank to de-link its interests in the twoleasing businesses and to play a direct role in the development of SALE," says a member of the managing board of WestLB, Klaus-Michael Geiger.

There is no change in the ownership of the 35.5% held by SIA or the combined 29% held by two Singapore government investment arms.

SALE has 16 Airbus A320s remaining on firm order for delivery through 2006. With the leasing market improving, managing director Robert Martin says: "We are now gearing ourselves up for the next market upswing and we are beginning to focus onwhere we want to invest our capital going forwards."

He adds that "those decisions will be made during the balance of this year" and new aircraft orders from Airbus and Boeing will be considered, as will more purchase and leaseback deals with airlines.

SALE chairman Chew Choon Seng, also SIA's CEO, says: "Boullioun not only provided capital investment but also its knowledge of the... leasing business. With WestLB on board, SALE is well positioned to move into the next phase of its development."

NICHOLAS IONIDES / SINGAPORE

Source: Flight International