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Scale is becoming more important, CEO says

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Bidding process for Macquarie AirFinance 'very

competitive'

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Confident Boeing MAX 10 will be certified this year

By Padraic Halpin and Tim Hepher

DUBLIN, Jan 29 (Reuters) - Aviation Capital Group (ACG)

plans to keep expanding after a recent large Boeing ( BA )

order, believing it is "critically ‌important" to stay among the

world's top 10 aircraft lessors as the industry consolidates,

its chief executive said.

ACG ​ordered 50 Boeing MAX jets this month, split evenly

between the 737-8 ‍and 737-10 variants. The deal brings to more

than 500 ⁠the number of ⁠aircraft it owns, manages or has on

order. It is now the lessor with the largest ‌order book of MAX

10s.

"I think what you're ​seeing now is a very different ACG than

the past and that's because the industry has changed," CEO Tom

Baker told ⁠Reuters, citing a more international, sophisticated

and ‍consolidating sector.

"We ​want to be large enough to be relevant to our customers.

We do think being top 10-ish is critically important. We do need

to ‍get bigger over time because scale is becoming more

important."

Baker was speaking on the sidelines of the Airline Economics

conference, the leasing industry's largest annual gathering

where most executives were predicting another wave of

consolidation.

California-based ACG will remain "disciplined buyers," Baker

said. It recently withdrew from bidding for Macquarie

AirFinance, a rival with ​more than ‍300 owned and committed

planes that is 50%-owned by the Macquarie Group ( MCQEF ).

"When you look at Macquarie, we already have a platform so

we're ​not going to pay for that and we believe that there are

some bidders out there who are willing to pay for the platform,"

said Baker, who described the sales process as "very

competitive".

The recent Boeing ( BA ) order ensures ACG, a subsidiary of Tokyo

Century Corp ( TCNRF ), has a steady stream of deliveries to

2033. Baker said he was confident that ​the larger MAX 10 plane

would be certified this year.

"Banking on the government is always a tricky thing, but

we're very confident. We do think it will happen, and I

personally think ‍it will happen this year," he said.