Bristow buys 42.5% stake in Brazilian helicopter company, Sells 5 aircraft

Bristow Group, which provides helicopter airlift services to offshore oil rigs, said it acquired a minority stake in a Brazilian helicopter & aviation services company in a deal aimed at capitalizing on South America's growing oil business. Houston-based Bristow said it will pay $174M for a 42.5% stake in Lider Aviacao Holding, providing helicopter & exec aviation services. At the same time, Bristow sold 5 aircraft to Lider for $55M, reducing net cash outlay to $119M. Terms of the agreement include incremental earn-out payment to $53M based on Lider achievement of growth target for earnings before tax, depreciation & amortization in the next 3 years. Lider operates 46 helicopters serving the oil & gas industry, representing about half the oil & gas market in Brazil. Its helicopter business is Lider's most profitable segment, as revenues rising at a compounded annual rate over 22% in the past 3 years, to $305M in '08, it said. Its adjusted earnings before income taxes, depreciation & amortization were $33M in '08, it said. "We view Brazil as the next North Sea in terms of its potential for growth in offshore services requirements," said Will Chiles, President & CEO. The acquisition "reps our most attractive entry point in a new market that's a critical part of our long-term growth strategy," he said. Lider has a strong customer base in the offshore oil & gas industry, including Petrobras, Chevron, Spain's Repsol, Anadarko Petroleum, Shell Oil & Norway's StatOilHydro, it said. Its relationships with the customers provide Bristow with an advantage in Brazil, he said.