The boards of Agility and National Aviation Services (NAS), one of Agility’s wholly owned subsidiaries, and the board of John Menzies PLC (Menzies) has today announced that they have reached agreement on the terms of a recommended cash offer to acquire 100.0% of the ordinary shares in Menzies at a price of 608 pence a share.
Menzies delivers time-critical logistics services at more than 200 locations in more than 37 countries, across six continents, through a global team of more than 25,000. Menzies Aviation is firmly established as a global player in cargo, fuelling and ground handling with strong competitive positioning within each of its core focus areas and an excellent reputation in the market.
The deal values Menzies at approximately £571m on a fully diluted basis and at approximately £763m on an enterprise value basis.
The board of Menzies intends unanimously to recommend the cash offer to their shareholders.
Agility stated that if approved by Menzies’ shareholders and regulatory authorities, the deal will create an industry powerhouse in aviation services.
The Combined Group is expected to be the largest airport services company in the world by the number of countries it operates in, second largest in terms of airports served, and third largest in terms of revenue.
The combined revenues of Menzies and NAS were more than $1.5bn in 2021. The Combined Group is expected to have approximately 35,000 employees with a presence at more than 250 airports in 57 countries, handling more than 600,000 aircraft turns per year.
The Combined Group will be wholly owned by Agility.
Vice-Chairman of Agility Tarek Sultan said: “Agility’s focus is on growth and shareholder value creation. We are a long-term, multi-business operator and investor aiming to create value with a disciplined investment strategy that focuses on companies in high-growth sectors with strong fundamentals, reinforced by management teams with established records, best-practices governance, and alignment with Agility’s vision and values. Menzies is a good fit. The aviation sector has strong growth potential, and Menzies is one of the most-established providers in the industry, with a sustainability focus we share. A NAS-Menzies combination will create a strong and resilient industry player, well positioned to grow, and drive future earnings. We expect this acquisition to further diversify Agility’s revenue base and strengthen cash flow generation.”
Agility reported that the combination of NAS and Menzies represents opportunities to:
It is intended that the Combined Group will use the globally-recognized “Menzies” and “Menzies Aviation” brands following completion of the acquisition.
Following completion of the Acquisition, it is intended that Menzies and NAS will be combined and managed by a team with representatives drawn from both Menzies and NAS with the current Chief Executive Officer, Chief Financial Officer, and Chief Operating Officer of Menzies in these roles in the Combined Group. The current NAS CEO is expected to assume the role of Chairperson of the Combined Group. The Combined Group will be governed by a professional board of directors through an appropriate governance structure.
NAS/Agility intend to support Menzies’ heritage and presence in the UK, including retaining a corporate hub and significant head office functions in Edinburgh. In addition, the intention is to open a new head office for the Combined Group in London, where certain senior management and some head office functions will be located. These arrangements will reflect the global footprint of the Combined Group’s operations and enable the Combined Group to have a new centre in London, where many of its clients have a presence.
Now that a recommended offer has been announced, Agility stated that the next steps are to seek approval from Menzies shareholders as well as the relevant regulatory authorities. Both companies will work alongside counsel to ensure that the requisite competition and regulatory filings are made in the appropriate jurisdictions. It is currently expected that the transaction will complete in the third quarter of 2022.
Source: Agility