Mercury Air Centers

Industry: Business Services
Initial Ownership: 100%
Date of Initial Equity Investment: April 2004
Date of Exit: August 2007

Business Description: Mercury Air Centers, Inc. (“Mercury Air” or the “Company”) was the fourth largest owner and operator of fixed base operations (“FBOs”) in the U.S. Mercury Air provided general aviation services to private, commercial and military aircraft at 24 FBO locations at 22 airports nationwide. These services included fuel sales, ground support services, aircraft hangar and tie-down facilities. The Company operated under the brand names Mercury Air Centers, Corporate Wings, FirstAir and IX Jet Centers, among others. 
Investment Thesis: Mercury Air represented a strong platform business in the highly fragmented FBO business with significant upside value potential. The Company also enjoyed:

  • High barriers to entry due to long-term contracts with airport authorities
  • A well established brand name in aviation services
  • Strong free cash flow characteristics


Investment Highlights: As Mercury Air was formerly a division of a larger Company, it did not have a back office function. The deal team worked to create the accounting, IT and HR departments. The deal team then worked to create value in the business by recruiting a new management team, helping the company implement several key operating initiatives including a new pricing strategy, and supporting six new site acquisitions. These improvements positioned the Company for a sale to a strategic buyer, Macquarie Infrastructure Company (NYSE: MIC) (“Macquarie”), in August 2007. Macquarie combined Mercury Air’s 24 FBO locations with its existing Atlantic Aviation sites, creating the largest network of FBOs in the U.S. with 67 total locations.

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