scary stuff

BAHRAIN: Bahrain’s FIIB to buy 33 pct of U.S. aviation firm.

06/11/2001
Reuters English News Service

© Reuters Limited 2001.

MANAMA, June 11 (Reuters) - Bahrain-based First Islamic Investment Bank (FIIB) has agreed to buy a 33 percent stake in U.S. aircraft maker Cirrus Industries for $133 million.
“It is expected that the acquisition will be completed by the beginning of July 2001,” FIIB said in a statement received on Monday.

The statement said Cirrus is the world’s third-largest manufacturer of single-engine, piston-powered aircraft.
“Cirrus has accumulated a backlog of approximately 620 aircraft, representing 18 to 24 months of production,” FIIB’s Chief Executive Officer Atif Abdulmalik said in the statement.

FIIB said on Sunday it had mandated Abu Dhabi Islamic Bank to arrange a $100 million revolving Islamic facility.

The three-year murabaha will involve the purchase and sale of investments or other assets arranged by the FIIB.

The bank said it had undertaken direct investment transactions in excess of $600 million in the United States and real estate transactions totalling $709 million.

FIIB was established in 1997 with a paid-in capital of $112.5 million. It is held by 80 individuals and institutions in Gulf Arab states and Malaysia.

If this proven to be true it will catapult Cirrus to another level. Access to this much liquid capital will give them a solid base from which to reach for the future.

We should all benefit from this capital infussion and the virtual certianty that the manufacturer of our aircraft, including the pretty diesel, will be around to support us in the future.

Following this company is never dull.

MANAMA, June 11 (Reuters) - Bahrain-based First Islamic Investment Bank (FIIB) has agreed to buy a 33 percent stake in U.S. aircraft maker Cirrus Industries for $133 million.
“It is expected that the acquisition will be completed by the beginning of July 2001,” FIIB said in a statement received on Monday.

What does it say about American investment houses, that both Cirrus and Lancair had to go overseas to get this type of large funding? (I seem to remember Lancair went with some Malaysian investment firm.)

I’m assuming the logistics would be simpler for small US businesses to go with an American firm – so does that mean that no domestic firms were willing to invest in such a large amount in these new plane manufacturers?

Or does it imply that these foreign companies want in to the small aircraft market so badly that they’re willing to make their terms palatable enough to overcome the legal/accounting hassles that would presumably stand in the way of international funding?

Steve

The three-year murabaha will involve the purchase and sale of investments or other assets arranged by the FIIB.

What’s a murabaha?

  • Mike.

BAHRAIN: Bahrain’s FIIB to buy 33 pct of U.S.
What’s so scary? I suspect most Cirrus ownwers have at least one auto and many appliances that were made by compnies that are non-US owned or owned by both US and international interests. I also suspect that many of us invest directly or indirectly in foreign companies. If I am not mistaken, Commander is owned by Middle East interests and the new Grumman Tiger is owned by Asian interests. International capital investment is not new and is growing. As long as the new combination of owners puts out a great product and runs the company well, everyone benefits.

Lou

aviation firm.

06/11/2001
Reuters English News Service

© Reuters Limited 2001.

MANAMA, June 11 (Reuters) - Bahrain-based First Islamic Investment Bank (FIIB) has agreed to buy a 33 percent stake in U.S. aircraft maker Cirrus Industries for $133 million.
“It is expected that the acquisition will be completed by the beginning of July 2001,” FIIB said in a statement received on Monday.

The statement said Cirrus is the world’s third-largest manufacturer of single-engine, piston-powered aircraft.
“Cirrus has accumulated a backlog of approximately 620 aircraft, representing 18 to 24 months of production,” FIIB’s Chief Executive Officer Atif Abdulmalik said in the statement.

FIIB said on Sunday it had mandated Abu Dhabi Islamic Bank to arrange a $100 million revolving Islamic facility.

The three-year murabaha will involve the purchase and sale of investments or other assets arranged by the FIIB.

The bank said it had undertaken direct investment transactions in excess of $600 million in the United States and real estate transactions totalling $709 million.

FIIB was established in 1997 with a paid-in capital of $112.5 million. It is held by 80 individuals and institutions in Gulf Arab states and Malaysia.

Through the magic of investigative journalism, I have learned (or have heard):

  • that there is definitely something behind the reports of this deal;

  • that the details in this release, including the numbers and the reported finality of the arrangement, should not be relied on.

As I understand it, something certainly is afoot, which could be good for Cirrusdom. But not yet nailed down. FWIW.

If this proven to be true it will catapult Cirrus to another level. Access to this much liquid capital will give them a solid base from which to reach for the future.

We should all benefit from this capital infussion and the virtual certianty that the manufacturer of our aircraft, including the pretty diesel, will be around to support us in the future.

I agree. It is good news and for those who worry, 33 percent is not control of the company. Next step…williams jet engines and RG!

Denis (N766CD)

If this proven to be true it will catapult Cirrus to another level. Access to this much liquid capital will give them a solid base from which to reach for the future.

We should all benefit from this capital infussion and the virtual certianty that the manufacturer of our aircraft, including the pretty diesel, will be around to support us in the future.

Finally a sensible post on this thread. Thanks Bob.

Anyone who finds this investment scary without researching the investor or understanding his goals, soley on the basis of it being from far away - shouldn’t be flying airplanes.

Let’s look forward to this making Cirrus even stronger.

Steve (Canadian in Ireland)

33% can easily be control! If the ‘other’ shareholders have less! large infusions of capital esp. from oversees usually mandate CONTROL. Maybe ther’s a different agenda.

Don

If this proven to be true it will catapult Cirrus to another level. Access to this much liquid capital will give them a solid base from which to reach for the future.

We should all benefit from this capital infussion and the virtual certianty that the manufacturer of our aircraft, including the pretty diesel, will be around to support us in the future.

I agree. It is good news and for those who worry, 33 percent is not control of the company. Next step…williams jet engines and RG!

Denis (N766CD)

Following this company is never dull.

Jim,
It appears these guys read your book.

Is it available in ‘Bahrainian’?

Steve, Possibly it is simply supply and demand. Bahrain and other oil producers are as awash in dollars, and Euros, as they are in oil. So their supply excess is money [looked at your gas bills lately]. What are they going to do with it? Use it to grow more sand? The primary oil field infrastructure was put in place years ago with Western money, and the upkeep is small, relatively. So now they’re looking for something to do with their oil money - investment options in the land of OPEC are nil - so here they come Duluth! Gary

MANAMA, June 11 (Reuters) - Bahrain-based First Islamic Investment Bank (FIIB) has agreed to buy a 33 percent stake in U.S. aircraft maker Cirrus Industries for $133 million.
“It is expected that the acquisition will be completed by the beginning of July 2001,” FIIB said in a statement received on Monday.

What does it say about American investment houses, that both Cirrus and Lancair had to go overseas to get this type of large funding? (I seem to remember Lancair went with some Malaysian investment firm.)

I’m assuming the logistics would be simpler for small US businesses to go with an American firm – so does that mean that no domestic firms were willing to invest in such a large amount in these new plane manufacturers?

Or does it imply that these foreign companies want in to the small aircraft market so badly that they’re willing to make their terms palatable enough to overcome the legal/accounting hassles that would presumably stand in the way of international funding?

Steve

What’s a murabaha?

Murabaha is the most popular and most common mode of Islamic financing. It is also known as Mark up or Cost plus financing. The word Murabaha is derived from the Arabic word Ribh that means profit. Originally, Murabaha was a contract of sale in which a commodity is sold on profit. The seller is obliged to tell the buyer his cost and the profit he is making. The contract has since been modified for application in the financial sector.

The Murabaha is, overwhelmingly, the most popular, tried and tested form of Islamic financing and forms the backbone of Islamic trade finance.

I heard it’s a new dance.

What’s a murabaha?

  • Mike.

Gordon –

Live and learn… thanks!

  • Mike.

Murabaha is the most popular and most common mode of Islamic financing. It is also known as Mark up or Cost plus financing. The word Murabaha is derived from the Arabic word Ribh that means profit. Originally, Murabaha was a contract of sale in which a commodity is sold on profit. The seller is obliged to tell the buyer his cost and the profit he is making. The contract has since been modified for application in the financial sector.

The Murabaha is, overwhelmingly, the most popular, tried and tested form of Islamic financing and forms the backbone of Islamic trade finance.

Gordon, All correct. More specifically it is an approved “legal fiction” which permits observant Moslems to ‘earn on their money’ without receiving “interest” which is forbidden to them in financial transactions by the Koran. Gary

What’s a murabaha?

Murabaha is the most popular and most common mode of Islamic financing. It is also known as Mark up or Cost plus financing. The word Murabaha is derived from the Arabic word Ribh that means profit. Originally, Murabaha was a contract of sale in which a commodity is sold on profit. The seller is obliged to tell the buyer his cost and the profit he is making. The contract has since been modified for application in the financial sector.

The Murabaha is, overwhelmingly, the most popular, tried and tested form of Islamic financing and forms the backbone of Islamic trade finance.

In the Baha-mas.

I heard it’s a new dance.

What’s a murabaha?

  • Mike.

Through the magic of investigative journalism, I have learned (or have heard):

  • that there is definitely something behind the reports of this deal;
  • that the details in this release, including the numbers and the reported finality of the arrangement, should not be relied on.

As I understand it, something certainly is afoot, which could be good for Cirrusdom. But not yet nailed down. FWIW.

Hmm, so all of this could turn out to be a bunch of “murabrouhaha?” :slight_smile:

Actually, I hope it is true, and that the % share is as little as a third, not close to or more than a half. It would be terrific for CD to get such a cash infusion yet maintain control of the company. I think we could then look forward to significantly increased ability to put more production tooling and new hires in place, sustained or improved QC, and then delivery times shrinking to the 8-9 month timeframe that the K’s say is their target.

Regarding the Aviation Consumer article, I do not think it was a negative piece at all; they state explicitly that the SR22 is an outstanding value and that its competition (?)–Mooney, Piper, even Lancair–had better check their six o’clock. Of course, all of us here already knew that. It’s their magazine’s business to nitpick–and they clearly labelled it as such–on any other aspects; readers can judge for themselves.