Fast-growing Verijet Scraps plans to go public via the SPAC merger

Verijet, a start-up operator of small private jets, has scrapped plans to go public via a SPAC merger and will instead pursue a private equity investment. The move comes after its partner New Vista Acquisition Corp. led by former Boeing CEO Dennis Muilenburg, has decided to wind down the special purpose entity.

The couple signed a non-binding letter of intent for a business combination earlier this month. However, the SPAC was facing a deadline to extend itself with a vote scheduled for February 10. It was then postponed by five days, and yesterday, instead of announcing the results, New Vista said it plans to go into liquidation.

The proposed deal would have made Verijet the third private jet airline to recently announce its intentions to go public. Directional Aviation’s Flexjet and FlyExclusive, two of the largest US carriers, have plans to go public this year via SPAC mergers. They follow Wheels Up Experience and Blade Air Mobility, which went public in 2021.

Verijet now expects to fund the growth from a private equity investment by New Vista Capital, with Muilenburg set to join the board, according to the private jet company’s founder and CEO Richard Kane.

After starting flights in 2020, the Miami, Florida-based charter operator ranked 30th in 2022th largest US operator based on charter and fractional flight hours.

A service area has recently been added for flights within 600 nautical miles of Fort Worth, Texas. Customers do not pay rebooking fees for flights within this zone.

After launching similarly from Orlando, Fla., Verijet has added service areas within 600 nautical miles of Santa Maria, California and White Plains, New York.

Verijet uses the Cirrus Vision Jet, a very light single-engine jet. The high-tech aircraft is known for being able to land itself at the touch of a button. Because the aircraft can be flown by a single pilot, the feature is designed to be used by passengers if the pilot becomes disabled during flight.

Verijet customers can pay extra and opt for a second pilot, which Kane says some customers do initially, but after a few flights they decide to save the money and get in the front seat next to the pilot.

Kane has previously said he wants to expand into the US and Europe and hopes to fly over 100 of the Vision Jets over the next few years.

While the hourly cost of chartering a Vision Jet is around US$4,000 per hour, about half the current price of larger light jets like the best-selling Embraer Phenom 300, it only seats three to five passengers, depending on configuration (compared to six ). to eight for most light jets). It’s also slower and doesn’t have a toilet.

However, it is well suited for flights between small airports where there is little or no direct service and would require either a connection through a major airline hub or a long journey of several hours.

According to Kane, Verijet has had no problem attracting customers to its Jet card. It has 22 members at the top level, meaning you buy 100 hours of flight time, and another 120 members split evenly between the 50 and 25 hour cards. When it recently gave members the option to roll over ahead of a rate hike, Kane said uptake was 100%.

Verijet currently has 19 aircraft in its fleet. New Vista had raised $276 million for its SPAC before announcing liquidation.

Leave a Reply

Your email address will not be published. Required fields are marked *