Photo by Thomas Tõnisson
As a result of a successful bond issue of 10 million euros OÜ Transpordi Varahaldus acquired an additional CRJ900 NextGen type aircraft, which was long-term leased to the Estonian national airline Nordica.
In December 2018 Transpordi Varahaldus OÜ (TVH) issued securities amounting to 10 million euros with an 8-year maturity. Securities were purchased by Estonian financial institutions AS LHV Varahaldus and AS LHV Pank. TVH used the additional finances for the acquisition of one vintage CRJ900NG, thereby increasing the fleet of the company to seven aircraft of the same type.
According to the member of the management board of TVH – Ergo Blumfeldt, this transaction marks the planned gradual expansion of the business activities of the company, preceded by thorough financial analysis and due performance of the current business plan. According to the estimation of the management board TVH will earn a profit of ca 3 million euros in 2018.
LHV Pension Funds Manager – Romet Enok noted that TVH bonds provide higher yield than usually found on the markets today. “We continue to search for and analyse local projects that are suitable for investing pension funds money into the Estonian economy and an additional aircraft with already pre-determined employment is an asset with real value and a properly secured investment,” Romet Enok explained.
„LHV Bank is glad to be involved in the investment plans of Transpordi Varahaldus. Estonian capital and an Estonian airline are still a good match and our cooperation allows the financing of also more expensive and unusual assets and finding the most suitable solution for our client,” commented LHV Corporate Banking Manager – Indrek Nuume.
In the course of the ongoing reorganisation of its activities, the Estonian national carrier Nordica intends to develop its business in export of services and the new aircraft has already been deployed for providing services to the leading Scandinavian airline SAS. According to the Chairman of the Board of Nordica – Hannes Saarpuu, the current market situation provides interesting export opportunities. “In case the supply currently exceeds demand in Tallinn airport, then it is reasonable for us to be present where we can expand our business in a more profitable manner. Issue of securities by TVH represents a good example of investors’ faith in the sustainability of our plans,” added Saarpuu.
Acquired aircraft is well-maintained and manufactured in the Bombardier factory in Canada, equivalent to the existing fleet of Nordica. The Estonian flag carrier continues its strategy of using same type of aircraft to maximise cost-efficient exploitation of its fleet.
TVH is a state-owned company operating as an investment entity, with the aim of financing and managing investments in fixed assets in the transport sector. Previously, TVH has carried out a successful bond issue of 25 million euros in 2017, which then allowed the acquisition of two CRJ900NG aircraft.