Acquisition of interests in Stobart Air & Propius
19 October 2016
STOBART GROUP LIMITED
("Stobart")
Acquisition of interests in Stobart Air and Propius
Stobart Group, the infrastructure and support services group, announces that it has agreed to acquire all of the interests of Invesco Asset Management Limited, acting as agent for and on behalf of its discretionary managed clients ("Invesco") in its airline business, Stobart Air, and aircraft leasing business, Propius Holdings Limited ("Propius").
On 20 December 2012 Invesco invested alongside Stobart Group in Everdeal Holdings Limited ("Everdeal"), the holding company of Stobart Air, and in Propius in order to support the growth of Stobart's aviation businesses. Propius owns the aircraft and leases them on a long term basis to the airline. Stobart Group has agreed to acquire unconditionally all of Invesco's interest in Propius amounting to 33.3% of the company for £12.0 million. Following this transaction Stobart Group will hold 66.6% of Propius. It has also entered into a conditional agreement to acquire at least 36% and up to 40% of Everdeal for £0.5 million from Invesco. This will increase Stobart's holding to in excess of 80%; the exact amount depending on whether other shareholders take up their pre-emption rights to acquire Everdeal shares. Completion of the Everdeal acquisition and the Propius transaction are both expected to occur in November 2016. Consideration for both transactions will be satisfied from Stobart's existing cash resources. The remaining 33.3% of Propius is owned by Aer Lingus.
Propius and Everdeal recorded profits before tax of $7.5 million (adjusted profit of $2.0 million) and €0.5 million respectively for the year ended 31 December 2015 and had gross assets at that date of $154.6 million (adjusted gross assets of $151.8 million) and €20.9 million respectively. The Propius adjustments reflect the sale of two aircraft by Propius in 2015 which would have amounted to a Class 2 transaction for Propius under the Listing Rules.
Stobart Air operates regional air passenger services between a variety of centres in Europe and the UK, including Stobart's award-winning London Southend Airport. These transactions will enhance Stobart's flexibility in building new passenger routes at London Southend Airport with the aim of increasing passenger numbers to a run rate of over 2.5 million per year by 2018.
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