Building An Independent Full-Service MRO In Australia

Looking for another growth opportunity, Jonas Butautis identifies one to develop an independent MRO down under.

Is there room in Asia-Pacific for another one-stop MRO provider, unaffiliated with any airline? Heston Aviation acquired Aircraft Maintenance Services Australia, a line-maintenance company, from SIA Engineering because it believes there is. Heston sees an opportunity to develop a truly independent one-stop MRO company in Australia, says Heston Partner Jonas Butautis.

Heston began a few years ago as an aircraft leasing and trading company, but recently expanded its management team with individuals experienced in developing independent MRO companies by blending capital and engineering strategies. “Thus it was a natural strategic direction to look for global MRO opportunities that we can buy and add value to through accumulated knowhow and capital,” Butautis says. “Aircraft Maintenance Services Australia, or AMSA, was a perfect fit for this purpose.”

Butautis notes there is a group of global MRO companies that blend labor-intensive MRO with capital- intensive asset management, including AAR, GA Telesis and ST Aerospace. Heston believes in this business model. “MRO engineering infrastructure adds value to asset operations and vice versa, asset projects help develop independent MRO service offerings.”

So Heston is not looking at AMSA just for its line operations. “We see AMSA as a platform to develop a full-scale, multi-service independent MRO company in Australia and the wider region,” Butautis says. AMSA will be rebranded and will add component, engine and engineering solutions and possibly move into limited heavy maintenance as well. “There is an empty space for independent heavy maintenance in Australia, we see this as an opportunity.”

Heston will also expand AMSA’s line maintenance services. Butautis believes there is a lot of inefficiency in the region’s market, with many global airlines posting their own foreign staff to support line operations in Australia. “There is no reason why this cannot be done more cost-effectively, with the same or improved quality and dispatch reliability, by a local independent MRO company.”

The new AMSA will ruthlessly focus on quality and integrate line maintenance into a wider total care offering, so customers have one point of contact for getting the aircraft airborne on time. It will expand into consumables, wheels, brakes, components, interiors and engineering services, differentiating itself from pure line-maintenance providers.

AMSA will be the only major independent MRO in its home market and well-positioned to support mid-sized to small local and regional airlines, which outsource most technical services. “For major airlines, it will offer an option for improving operational efficiency through no-nonsense quality MRO solutions,” Butautis says.

The Heston partner has a track record that justifies his optimism. He was CEO of FL Technics during its growth years of 2009 to 2013 and from 2014 until 2017 CEO of Magnetic MRO, which was sold to China’s Hangxin in April 2018.

TAGS: Asia Pacific
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