Columbia Model CH-47D Chinook dropping retardant at the Rice Ridge Fire, Seeley Lake, in Montana, in 2017. File photo
On the heels of a recent restructuring to cushion the impact of the oil and gas market downturn over the past few years and the uneven recovery of those markets, Bristow Group on Nov. 9 said it has signed a $560 million acquisition of Oregon-based, privately held Columbia Helicopters, a provider of heavy-lift helicopter operations and MRO services.
Bristow said that the acquisition is the largest in company history.
Columbia is to be a subsidiary of Bristow, but will still operate under the Columbia name.
While oil prices have shown a rebound, analysts have said that the overcapacity of underutilized oil and gas helicopters over the past few years will likely slow new sales of such helicopters. Bristow intends to take the company, which has been offshore oil and gas-centric, in a new, significantly diversified direction.
While 67 percent of Bristow operating revenues have been in the oil and gas market, that percentage will fall significantly, the company said. One-third of the new company's cash flow is to be oil and gas, one-third search and rescue (SAR) and one-third government and military revenue.
Bristow said the Columbia acquisition also will help its oil-and-gas business, as Columbia includes maintenance, repair and overhaul (MRO) services for oil and gas helicopters and as Bristow may lease underutilized oil and gas aircraft to Columbia. In addition, Bristow said it has returned six of its 11 leased Airbus Helicopters H225 heavy-lift oil and gas helicopters to lessors. It will return another this fiscal year and the final four in fiscal 2021.
For the fiscal year ending Sept. 30, Columbia had revenues of $281 million and an adjusted cash flow of about $117 million. The company's operational fleet includes 11 Boeing Vertol 107s and 10 Chinook CH-234/CH-47Ds that serve the defense, firefighting, onshore oil and gas, infrastructure and forestry sectors. In addition, the company has 24 Boeing Vertol 107s and 13 CH-234/CH-47Ds in reserve.
On the defense side, Columbia is a a Commercial Airlift Review Board (CARB)-certified operator, a designation that allows the company to provide outsourced military transport. Columbia has provided charter services for soldiers in Afghanistan and has carried cargo, mail and passengers in the country for U.S. Transportation Command (USTRANSCOM).
"Columbia is one of only three operators that can support requirements under its current contract within the broader CENTCOM [U.S. Central Command] area of responsibility," Bristow said. "After obtaining its CARB certificate in 2011, Columbia was awarded its first USTRANSCOM Afghanistan contract for four aircraft. In 2017, due to its strong performance and reliability, Columbia won a contract expansion to 10 aircraft, which was increased to 12 aircraft in 2018 ... Columbia’s 107/234 fleet is uniquely positioned to support heavy, high and hot flying environments with tandem rotors providing increased operational stability."
Regarding the 107/234s, Bristow CEO Jonathan Baliff said that "if something was to happen where those aircraft were reduced, they can be redeployed fairly quickly in TRANSCOM" or outside of U.S. government work.
Baliff said that Bristow and Columbia "share a long-standing, proven commitment to safety, and Columbia's specialized heavy-lift capabilities are highly complementary to Bristow's offshore capabilities."
"We therefore see significant opportunity to leverage the combined company's fleet, MRO capabilities and certificates to expand our addressable market opportunities globally," Baliff said. "Just as importantly, we believe we will be able to utilize our U.K. SAR expertise to build our combined business in the growing U.S. government and industrial end-markets, where Columbia has deep experience."
Baliff said Nov. 9 that he will retire after the conclusion of the Columbia acquisition. Thomas Amonett, vice chairman of Bristow's board of directors, is to serve as interim president while Bristow seeks a new CEO.