Jetrader - Spring 2018 - 42

aviation insights

A Conversation with
DAE Chief Executive Officer

Firoz Tarapore

In the newest installment in this ongoing series, ISTAT Aviation Insights, sponsored by PwC, returns with a conversation with another
industry player. In this conversation, Gerry Butler, managing director for Merx Aviation Finance, sits down with Firoz Tarapore,
chief executive officer of DAE.
What follows are some highlights from the conversation between these two industry insiders, but be sure to check out the full
video on ISTAT's YouTube page at http://bit.ly/ISTATYouTube, and be on the lookout for more interviews throughout the year.
Gerry Butler: Firoz, it has been a whirlwind six months for you by taking over
AWAS and creating this new venture. Can
you explain to us and to our audience
why AWAS and why now?
Firoz Tarapore: This was a pretty simple
decision for us. Since we sold StandardAero
in 2015 and we had that excess capital to
deploy, we were looking at opportunities
to deploy that. So, we looked at just about
everything that came out between the end
of 2015 and when we did this transaction.
But when AWAS came out, we knew that
this was a perfect fit from just about any
standpoint - size, people, systems, processes. And as we went more and more into
the due diligence process, our conviction
level grew to such an extent that we put
forth all of our resources to make sure that
we acquired this particular asset, because
what this does for us now is effectively fast
forwards us five, ten, maybe more, years
into our development.
From a strategic perspective, this was an
absolute no-brainer for us. And the more we
looked at this particular company, the more
we found that there was a great fit with the
people, how they approach their day, how
we went to market, and we felt that bringing these two companies together would
have very little execution risk relative to
some of the other things that we had seen.
You've seen the reaction from the
market; there is an incredible amount of

validation in what we've done; the dialogue
that we have now with our clients, with
our OEMs, with our providers - whether
that's liquidity, or other providers - it's
just totally different. This was a home run
from a strategic perspective for us.
GB: Obviously this gives DAE, in terms
of aircraft leasing, much more significant scale. Maybe you could touch upon
what scale means in terms of this very
competitive business and how you would
approach that.
FT: I think scale in this business - and
not just for us - is very critical. With
scale, you obviously get the right metal
price, right financing options, the right

42 The official publication of the International Society of Transport Aircraft Trading

discussion with the clients, the right ability to provide broader solutions to clients,
etc. So, getting to scale was really critical
for us.
The definition of scale in our business
continues to change almost on a daily
basis, so not too long ago the size of the
number 10 player was $2 billion. Today,
the size of the number 10 player is over
$10 billion. Today we have three groups
with more than $20 billion in assets. If
you roll forward all of the orders that we
see already on a committed basis, in the
not-so-distant future there will be six,
maybe seven, groups who will be at the
$20-plus billion level. That scale actually
means something in their ability to earn

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Jetrader - Spring 2018

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