Best known for their extensive property empire, the Reuben Brothers are also at the helm of a rather impressive aviation empire, consisting of an airport, a heliport and a now-defunct airline.
Though not as large as the aviation holdings owned by a solely-aviation investor Kenn Ricci, the brothers’ aviation empire neatly fits into the brothers’ real estate holdings without suffering overdiversification problems.
Who Are The Reuben Brothers?
The Reuben Brothers – David and Simon – are Indian-born British businessmen and property investors worth an estimated £16 billion ($20 billion), whose properties include London’s Millbank Tower, AMEX’s London HQ and Hampton House.
Born in Bombay (now Mumbai), India in 1941 and 1944 respectively, the brothers moved to London in the 1950’s with their mother, Nancy Reuben, following her separation from the brothers’ father David Sassoon Reuben.
Although their family had been quite prosperous – as many Iraqi-Jewish families had been in India – their move to London saw the family cut off financially, forcing the brothers to attend state schools and live in a working class neighborhood in Islington, North London.
Perhaps spurred on by their poverty, a desire to rebuild what their family had lost, or even a mixture of the two, both brothers started working quite early on, with Simon even leaving school early to accomplish this.
At 17, David began working as a scrap metals trader, whilst Simon got his start in carpets. Eventually, the brothers got enough money together to go out on their own and Simon bought the oldest carpet company in Britain.
Soon thereafter, the brothers began investing in London property, seeing their combined net worth increase exponentially in the 1970s and 1980s as they continued to add to their portfolio and London real estate prices skyrocketed.
Following the collapse of the Soviet Union, the brothers got involved in the Russian metals market, using their company Trans-World to buy out struggling Russian aluminium smelters to the tune of £870 million ($1.5 billion) at the time.
Other holdings of the brothers’ include almost 40% of Britain’s racecourses, 10% of football (soccer) club Newcastle United and minor holdings in companies like Metro Bank, Blue Inc, Travelodge Hotels, Belmont Ltd and D2 Jeans.
Aviation Holdings
In an attempt to diversify their holdings, chiefly their real estate portfolio, the Reuben Brothers have began investing in aviation, with the companies they’ve acquired including:
London Oxford Airport
SilverJet
Only a few months after making headlines for their acquisition of Kidlington Airport, the brothers again made headlines for an aviation-related investment, this time in all-business class airline Silverjet in November 2007.
Based out of London Luton Airport, the airline was in need of £22 million to shore itself up financially. The brothers put up £10 million in the form of a convertible loan through their company TFB (Mortgages).
Within days of the deal being announced, the company’s stock price plummeted to 60p a share (from a flotation price of £1.12) and continued to crash to an all-time low of 24p by February 2013.
Had the brothers converted their loan to equity, it would’ve made them the largest shareholder with around a 22% stake in the airline.
London Heliport
An Integral Part of Their Business?
Although the value of their aviation holdings only account for a tiny fraction of their £16 billion ($20 billion) fortune, their aviation holdings is arguably the glue that keeps the rest of their empire intact.
You see, aside from offering them a means of diversification whilst still retaining the real estate aspect they so seem to love, their acquisition of Oxford Airport and London Heliport acted to multiply their returns during the 2012 Olympic Games held in London.
Following their acquisition of what was then known as Kidlington Airport, the brothers spend a considerably fortune upgrading it, making the runway more accessible to larger private jets, like those used by athletes on their way to compete in the games.
The brothers even went to considerably lengths changing the airport’s name to “London Oxford Airport” – emphasizing its close proximity to the city hosting the games in an attempt to drive traffic to their airport.
By acquiring London Heliport in February 2012, mere months before the games began in July, the brothers had a direct link into the heart of London.
Athletes could arrive en masse to London via their private jets (many of which landed at Oxford Airport) before taking a helicopter into the middle of London to get to the Olympic Village, thus earning the brothers money for both flights. Not to mention the return leg.
Coupled with the brothers’ other investments in the games – namely their £2 billion stake in the Queen Elizabeth Olympic Park, which was purpose-built for use in the games – it should come as no surprise their wealth jumped from £7.08 billion to £8.28 billion between 2012 and 2013!
Since then, there has always been a strong connection between Oxford Airport and London Heliport, with the two repeatedly sending business towards the other, similarly acting as a multiplier for the brothers’ wealth.
Plus, it hasn’t exactly hurt the brothers’ real estate holdings in the city. It just makes it easier for the brothers to get there, considering many are only a stone’s throw away from the heliport.
What do you think about the Reuben Brothers’ aviation holdings? Tell me in the comments!