David Andrews has resigned from investment firm Pimco to start his own venture. Timelines are yet to be agreed but industry friends have been quick to wish him well.
Greg Lee of Goldman Sachs says: “David has been pivotal in many of the best deals of recent years and is a good friend, both he and his successor at Pimco will continue to have an impact”
David Andrews says: “There is a huge search for yield in every fixed income asset class, When you look around your options, particularly in corporate bonds, the risks are dramatically changing today. We are seeing a concerted and steady real energy of corporate balance sheets, which is generally not a positive for bond holders. We are seeing a lot of stock repurchases and increasing dividends, a lot of calls on capital and in some cases companies are borrowing to support their shareholder-friendly activities. So there is a lot of risk in the straight, unsecured corporate lending space. The aircraft market is a relatively safer port. Aircraft are also hard assets in a world where central banks globally are devaluing currencies, flooding the markets with liquidity, trying to push inflation up. Therefore investing is hard, real assets is a real positive. For all those reasons, it is a good time to step out and try to do something on my won. I have been with Pimco for ten years and have enjoyed my time there enormously but for me it was time to move on.”
The credit analyst, who has been with Pimco for ten years, has been a pivotal investor in countless aviation financings and his resignation has come as a shock to many in the industry.
Mark Lapidus, Managing Director at Doric, says: “David’s insightful, methodical intellect, coupled with old style fieldwork, will be much missed, as will be his penetrating, Helen Thomas press-core style questions at conferences, and I hope that in his new travails we cross path again soon.”
Although Andrews is reluctant to speak further about his plans for the future, he told Airline Economics that “wheels are definitely in motion” and elaborated that he will be interested in deals such as the Doric Alpha in 2012 in countries across the globe that have either endorsed Cape Town or have a legal framework that is rock solid but are yet to ratify the treaty such as the United Kingdom. Indeed, Brian Jeffrey of Emirates Airline who was told the news by David stated “I'm a little stunned; David was Mr. Pimco to us at Emirates, and we will miss jousting with him. He has a very impressive critical mind yet retains a commercial outlook. We wish him the very best in his future endeavours”.
David with his extensive knowledge and contacts is sure to do very well indeed, this morning Orix Aviation issued a statement on the matter saying “ORIX Aviation wish Dave all the best of luck with his new venture. He has been a very important and influential figure in the aviation capital market spaces over many years and we hope that his new venture is a great success.”
As David moves on Pimco will be sure to announce the replacement soon enough and there is no question that their offices will continue to lead and indeed influence the aviation market investment space, and it is this which is the very good news for aviation. The pool of active investors has just become larger (or will at least in the near future), this is a good day for aircraft investment and it is a natural step, for as investors move into the sector so they both bring others to the table and increase the pool as they move from company to company.
Prior to joining Pimco, Andrews was a Director in Investment Grade Fixed Income Research at UBS Warburg/Paine Webber, where he covered US autos, transportation, aerospace/defense and capital goods. Prior to joining UBS Warburg he spent six years at Moody's and was responsible for global ratings of all automobile companies. Andrews has twenty-two years of investment experience, holds a bachelor's degree from Kenyon College and an MBA from the Lublin School of Business at Pace University.