BBA Aviation Eyes Acquisition Of Landmark

The deal will be funded via new debt facilities and a fully underwritten rights issue of 562,281,811 shares at an issue price of £1.33 per share, raising $1.15 billion, according to Reuters.

Landmark is an integrated aviation service provider offering end-to-end support services to Business and General Aviation or B&GA customers.

The purchase will add 56 locations to Signature’s 133 FBOs, 70% of which will be in North America, where the country’s slow-but-steady economic growth is pushing a rebound in private business aviation.

Given the acquisition history of Landmark, its historical financial record is of limited relevance in assessing the scale, value and opportunity that Landmark represents for BBA.

BBA is participating in a sale process for Landmark Aviation, which is owned by private equity firm Carlyle and has attracted several bidders, including buyout firms.

It has a presence at four in the top five and 14 in the top 50 USA airports. “Combining Signature and Landmark Aviation also would realise significant cost synergies as well substantial tax benefits”, said Simon Pryce, chief executive of BBA Aviation. BBA will fund the deal through a £748million cash call.

Shares in BBA rose 2.4p to 287.1p in late afternoon trading in London.

“Inevitably, this has required the group to pay a full multiple and to stretch the balance sheet”. The transaction is subject to regulatory and shareholder approvals and is expected to close in early 2016.