Dubai Aerospace Enterprise

Overview: In 2007, Dubai Aerospace Enterprise (DAE) sought to acquire from The Carlyle Group both Landmark Aviation, the country’s second largest Flight Based Operations (FBO) network of private airports and Standard Aero, a leading aviation maintenance and repair company with facilities throughout the U.S. and Canada. The potential transaction would be beneficial to both parties in view of their respective investment strategies and existing operations, but was likely to face significant scrutiny in the lingering wake of the Dubai Ports World controversy. Additionally, legislation seeking to reform the Committee on Foreign Investment in the United States (CFIUS) process, which was a key element of the Dubai Ports debacle, was working its way through Congress at the time. The Herald Group was tasked with developing an integrated communications program to mitigate potential threats and to help educate select media on the legitimacy and benefits of the proposed sale.

Objectives and Strategies: The Herald Group developed and executed a broad communications program to support the efforts of those directly involved in the negotiations and the stakeholders tasked with presenting the proposed transaction to CFIUS agency representatives and targeted Members of Congress. The strategy was two-fold. The first component focused on ensuring that the parties would not only follow the letter and spirit of the laws governing the existing CFIUS process, but would also proactively incorporate the proposed reforms being debated in Congress at the time. Additionally, both parties sought to educate key Members of Congress with relevant committee jurisdictions or constituencies potentially impacted by the sale well in advance to ensure there were no “surprises.” The second strategic effort leveraged a positive byproduct of the Dubai Ports debate, namely whether the U.S. was indeed “open for business” via foreign investment as many, if not all, policymakers claimed. The sale of Landmark Aviation and Standard Aero ultimately was positioned as a test of this resolve. Essential to this effort was the collaboration between The Herald Group and the lobbying team and the establishment of key messages shared by both parties and the discipline with which they were conveyed to key audiences and decision makers. Throughout the implementation of these strategies, The Herald Group engaged influential individuals outside of the negotiating parties to serve as surrogates before the media, including former government officials and Members of Congress who worked directly with targeted reporters.

Results: The sale of Landmark Aviation and Standard Aero is now viewed as a blueprint by which future transactions should be managed through the CFIUS process. Major controversies related to the transaction were wholly avoided both in Congress and among the media. In fact, the sale produced overwhelmingly positive media coverage because of the communications process that was predicated on education and transparency.