Blackstone is close to reacquiring Trans Maldivian Airways for a price nearly equal to its original sale, following a tumultuous eight years characterized by bankruptcy and restructuring due to pandemic impacts. TMA, a significant player in Maldives tourism, is expected to rebound as leisure travel recovers.
Blackstone, the largest private equity firm, is nearing a deal to reacquire Trans Maldivian Airways (TMA) nearly eight years after selling it for $500 million. This move comes as TMA faced significant challenges due to the pandemic, leading to its bankruptcy and subsequent debt restructuring, after previous owners Bain Capital and Tempus Group failed to pay a $305 million loan.
Originally, Blackstone exited its investment for a significant return, monetizing $98 million into $500 million through the Bain-led consortium. However, the new owners invested an additional $115-$120 million in debt and equity, but their plans floundered when the pandemic disrupted travel, ultimately causing the reassessment of TMA’s valuation, expected to be in the range of $550-$700 million.
Prior to its financial turmoil, TMA operated the world’s largest seaplane charter service. It connects over 80 resorts across 16 atolls in the Maldives, performing more than 400 flights daily. During the pandemic, TMA adapted by halting scheduled flights and moving to an on-demand model, indicating its reliance on the travel and hospitality sectors.
TMA had revenue of approximately $177.9 million in 2024, with expectations of $70-$80 million in EBITDA for the current fiscal year. Various other private equity firms and business groups were initially approached regarding interest in TMA, but the volatility associated with the travel sector post-COVID kept many at bay. In 2024, competition for tourism in the Maldives intensified between India and China, marking a shift in traveler profiles.
Blackstone’s impending reacquisition of Trans Maldivian Airways highlights the turbulent journey TMA faced over the past eight years, underscored by shifts in ownership and operational challenges due to the pandemic. As the business adapts to evolving market conditions within the travel industry, its future remains crucially tied to resuming robust tourism flows and capitalizing on vacationer demand in the Maldives.
Original Source: infra.economictimes.indiatimes.com
