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Company in $1.9 billion aviation deal with Dubai
By Dan McCue
Staff Writer
Hawthorne Corp., of Charleston, and The Carlyle Group, one of the world’s largest private equity firms, sold two of their jointly-held aviation subsidiaries to Dubai Aerospace Enterprise for $1.9 billion.
Under the deal, which closed on July 31, DAE will take ownership of Landmark Aviation, a leader in the corporate jet services industry, and Standard Aero, which provides jet engine services and support to the commercial aviation industry.
DAE described the acquisition of the two companies as the cornerstones of Dubai’s effort to create an integrated aerospace cluster at Dubai World Central, a new 87-square-mile airport and logistics city being built in Jebel Ali, Dubai.
T. Dean Harton, president of the Hawthorne Corp., described the deal as a satisfying culmination of the growth of the 75-year-old company and likened the completion of the deal to a cornerstone for more targeted, regional investments in small- and medium-size businesses.
“Hawthorne has grown and evolved over the years, with aviation always being at our core, but interests extending into everything from real estate development to investment banking,” he said.
“Proceeds from this sale not only will allow us to do more regional investments in small businesses, but will also enable us to offer our business knowledge and business know-how to more of these entities.”
Landmark Aviation was an outgrowth of Hawthorne Aviation, which was founded in Charleston in 1932. In the 1960s, as a result of its success in aeronautics, the company began expanding into other areas, buying a Ford dealership, a real estate development company and other businesses.
In 1998, Hawthorne partnered with The Carlyle Group to acquire Piedmont aviation. The resulting company, Piedmont Hawthorne Holdings Inc., continued to acquire other entities in the corporate aviation arena, including Garrett Aviation Services, which it bought from General Electric in 2004.
Another of its acquisitions during that period was Standard Aero.
Harton, who was CEO of Piedmont Hawthorne Holdings Inc. until the Garrett acquisition and from then on served as the growing entity’s vice chairman, said the idea at the time was to merge Standard Aero with Hawthorne’s aviation division, by then renamed Landmark Aviation, but the two business’s divergent expertise made such a merger impractical.
The Hawthorne/Carlyle Group partnership finally found the synergy they had been seeking for the two companies by bundling them together for the sale.
Harton returned to Charleston after a stint in Winton-Salem, N.C., where Piedmont Hawthorne Holdings was headquartered, to re-establish the Hawthorne Corp. as a management and investment company.
“Today Hawthorne Corp. operates in two different arenas. On a global scale, we’re involved in a number of very large transactions,” Harton said. “In partnership with Carlyle, we’re now doing a series of major North American infrastructure projects.
“We’re working with another investment firm in Europe, which is focusing on a consolidation of the aviation service and maintenance industry there, and we’re also involved with a similar, major investment in India,” he said.
“In the non-aviation area, we also just bought a minority interest in a firm that makes equine products in North Carolina,” Harton added.
His thoughts returning to the deal at hand, Harton said he was most proud of what the agreement with Dubai said about the success of Hawthorne.
“That because even in 1998, when we did the first transaction with Carlyle, we were doing $20 million in revenue and that became $1 billion with this deal,” he said.
Asked if he thought there was a “secret’ to growing a company so successfully and in such a diverse manner, Harton declared that there is no secret at all.
“There’s just the knowledge you have,” he said. “You have to know how to consolidate businesses in the same industry and apply good management to the operation of your assets. Success grows from there.”
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