The JV was set up to in response to the growing demand for freighter aircraft, in line with the expansion in global e-commerce cargo volumes.
Its goal is to build a portfolio value at around US$600 million in five years, by investing in passenger aircraft that will be converted to efficient freighters.
ST Engineering will provide the associate maintenance and overhaul service options for these aircraft. It will also be the asset and lease manager to the JV, consistent with the group’s aviation asset management business model.
The JV will set up a subsidiary to hold special purpose companies for the purpose of freighter owning and leasing, once it is set up.
See also: ST Engineering enters Australian rail market with Queensland contract win
The group does not expect the set up of this JV to have any material impact on ST Engineering’s tangible asset per share and earnings per share for the current financial year.
Shares in ST Engineering closed up 2 cents or 0.50% at $4.01, before the announcement.
Cover photo: Albert Chua/The Edge Singapore
