Private aviation firm Wheels Up is going public via a merger with special purpose acquisition company (SPAC), Aspirational Consumer Lifestyle Corp. The transaction gives Wheels Up an enterprise value of $2.1 billion. Once the transaction is completed, the company will be listed on the New York Stock Exchange under the symbol "UP".
Wheels Up Story
Wheels Up has evolved and grown rapidly since it was founded by Kenny Dichter in 2013. The original core business started with a jet card like membership model and an exclusive fleet of King Air 350i turbo-props. Over the last seven years it has raised additional capital, acquired other operators, aircraft management companies and an aviation technology company. It also has an exclusive co-marketing partnership with Delta Air Lines, which formed after Wheels Up acquired Delta Private Jets and its jet card, charter and management business.
Wheels Up is now one of the largest private aviation platforms in the world, offering a comprehensive total aviation solution including membership programs, on-demand private flights across all cabin categories, aircraft management, whole aircraft sales, corporate solutions, signature events, and commercial travel benefits through the partnership with Delta Air Lines. In 2020, the Company says it flew more than 150,000 passengers, utilizing its access to over 1,500 owned, managed, and third-party partner aircraft.
SPAC Transaction Overview
On February 1, 2021, the SPAC Aspirational (NYSE: ASPL) entered into a definitive agreement to combine with Wheels Up through a combination of stock and cash financing.
Upon completion of the transaction, Wheels Up expects to have up to $750 million in cash on its balance sheet to fund operations and support new and existing business initiatives. This includes the contribution of up to $240 million of cash held in Aspirational's trust account from its initial public offering in September 2020. The merger is further supported by a $550 million PIPE (Private Investment in Public Equity) at $10.00 per share, including commitments from T. Rowe Price, Fidelity, Franklin Advisors, Durable Capital, HG Vora Capital Management, Third Point, Luxor Capital, and Monashee, among others.
Existing Wheels Up shareholders will roll 100 percent of their equity into the new company.
The transaction has been unanimously approved by Aspirational's Board of Directors and the independent directors of Wheels Up's Board of Directors, and is expected to close in the second quarter of 2021. The closing is subject to approval by Aspirational and Wheels Up's respective shareholders and other customary closing conditions, including any applicable regulatory approvals.
Same Leadership
Aspirational's Chairman and Chief Executive Officer, Ravi Thakran, former Group Chairman of LVMH South and Southeast Asia, and Australia /New Zealand and former Managing Partner of L Catterton Asia, will join the combined company's Board of Directors upon completion of the transaction. The Company's current management team will continue to lead Wheels Up.
Ravi Thakran, Chairman & CEO of Aspirational added "When we founded Aspirational, Wheels Up was exactly the kind of company we wanted to partner with. Kenny and his world-class team have created a truly iconic brand built upon years of exceptional, personalized customer experiences. They are a clear leader and innovator in the space and we look forward to working together to introduce Wheels Up to the global stage. We see many opportunities to leverage our experience and relationships to partner with other aspirational and luxury brands and to expand to international markets."
Kenny Dichter, Founder & CEO of Wheels Up said "We are excited about crossing this milestone and our new partnership with Aspirational. We believe this will allow us to actualize our founding goal of democratizing private aviation, through our unique membership model, suite of products and benefits, and by bringing the shared economy to private aviation through our Wheels Up app. We are looking forward to joining forces with the Aspirational team as we continue to accelerate our global growth and expansion."
Observation
Wheels Up will become one of the very few private aviation companies that are publicly listed. Most of them are privately owned.
Charter broker and aviation safety & security consultancy Air Partner is traded on the London Stock Exchange (LSE) under the symbol AIR.
NetJets is owned by Warren Buffetts Berkshire Hathaway (NYSE : BRK.A), although NetJets is a relatively small part of the vast Berkshire Hathaway portfolio of companies.