Goldman Sachs 2012 Annual Report Download - page 15

13Goldman Sachs 2012 Annual Report
capital worldwide, more companies have
turned to capital market instruments, such
United States, where funding streams are
As traditional sources
pull back, capital
markets step up
Q: What was the biggest challenge?
Tilton: For investors, perceived risk. “What if something goes wrong?
Can I retrieve the plane and sell it to get my money back?” That required
laws that specifically gave investors this right — laws that exist in the United
States and make collateralized instruments like EETCs common for United
States-based carriers.
Lee: The thing is, we now had that framework because of the Cape Town
Convention, a treaty that bound countries that signed to a similar set of
rules. Because the United Arab Emirates had signed, there was no reason
we couldn’t use EETCs — or that investors wouldn’t be interested. But that
was yet to be tested.
Q: How did you start?
Lee: By mapping out everything that had to go right, from positioning the
A380 as an asset to creating an instrument for a leasing company many
investors were not aware of. Doric didn’t just want a deal, they wanted to
set a benchmark — a transaction that would pave the way for many others.
Al-Ali: We knew we were doing something new, but we also knew it could
be done — and that, if anyone could do it, it was probably Goldman Sachs.
Our biggest advantage is a global culture based on collaboration and
teamwork — the kind of thing where, if you have to solve a problem,
people jump in, no questions asked.
Tilton: We had a team in Dubai covering Emirates, a team in London
working with Doric, and sales teams around the world who could educate
and work with investors. We also had a structuring team in New York with
a lot of experience in the transport sector — and all of these people were
extremely used to working well together.
Q: How did you successfully market the deal?
Lee: By focusing on the concerns of investors in each market — in Europe,
it was the structure; in Asia, the Emirates brand and its business strategy;
in the United States, the quality of the plane as an asset, because most
Americans are unfamiliar with the A380.
Tilton: We even flew potential investors around New York airspace in an
Emirates A380 so they could experience the plane and Emirates’ level of
service. For most investors, this was the first time they were able to
experience the quality of the Emirates brand.
Q: What was the impact of our success?
Lee: The transaction was a landmark — for our clients, for other airlines,
and for Airbus, which wants to promote EETCs as a way to finance planes.
Al-Ali: Also, it was especially important for companies from the growth
markets — and not just airlines. Others now see this as a creative new
way to access the capital markets.
From top: Michael Fox,
Nader Al Salim and
Elena Paitra (all London),
Radha Tilton, Greg Lee
(both New York); all
Investment Banking
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