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    Transport & logistics


    Headquartered in Brussels, Belgium, TCR is Europe’s largest independent asset manager of airport ground support equipment (“GSE”) and operates at 139 airports.

    Since inception, TCR has defined the market for leased GSE, providing high quality assets and a full service leasing, maintenance and fleet management offering to its clients, which are predominantly independent ground handling companies, airlines and airports. This enables GSE operators to concentrate on their core business of ground handling. The GSE that TCR provides is critical infrastructure, without which some of Europe’s busiest airports could not operate.

    Developments in the year

    TCR performed well in the year. It now operates in 139 airports, an increase from 112 at the start of the year. It has won new business across its established operations in Europe and Asia and commenced its first leasing contracts in the US and Australasia. Following its acquisition of Emerge Engineering and Maintenance in 2017, TCR signed a sizeable sale and lease-back fleet conversion in Australia and New Zealand.

    Contract renewal levels in its core European markets remain very high, demonstrating the defensive nature of the cash flows and TCR’s strong position in a growing market. Customers continue to value the improved efficiency, flexibility and reliability to their operations that contracting with TCR brings.

    As planned at acquisition, Tom Bellekens was appointed CEO in October 2018. Former CEO and founder, Marc Delvaux, remains with the business as a non-executive director.

    TCR was refinanced in June 2018 with long-term institutional funding on attractive terms, alongside a sizeable capital expenditure facility to support further growth.

    Aerolima acquisition

    TCR acquired Aerolima, another lessor of GSE in France. The transaction adds approximately 2,000 pieces of equipment, 20 airports and 12 workshops to TCR’s existing business.

    Investment rationale

    TCR fits with the Company’s strategy of investing in companies with good asset backing, strong market positions and barriers to entry, yet with operational levers to achieve attractive returns for shareholders through active asset management:

    • GSE is a scarce resource that is critical to the functioning of an airport; through first mover advantage, TCR has benefited from securing the largest independent GSE fleet in Europe. TCR has access to maintenance workshops in prime locations at airports, many of which are located airside. This means that a high quality maintenance and asset management service can be provided, resulting in high availability of TCR’s fleet.
    • TCR is able to offer full-service rentals on a pan-European basis. This creates competitive advantages against competitors, which tend to offer either dry leases or only repair and maintenance services. TCR’s network means it can offer pan-European solutions at multiple locations, matching the footprints of its customers.
    • Outsourcing ownership of GSE equipment makes economic sense for independent ground handlers, as it allows them to manage the mismatch between short-term handling contracts and the typically 10-15 year useful life of equipment.
    • TCR’s rental contracts are aligned with the ground handlers’ contracts with the airlines and are typically 3-5 years in duration. TCR has experienced a high level of contract renewal.
    • The business has a diversified portfolio and is present at over 100 airports across 12 countries with a diverse contract and customer base meaning the revenues of the business are not materially reliant on a single client or geography. 
    • The investment will provide exposure to the long-term growth in the aviation market, which is fundamentally GDP driven, yet it is expected to be insulated from short-term shocks to demand due to its exposure to aircraft movements rather than passenger numbers.
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