Reuters reported on Tuesday, citing sources, that BBA Aviation planned to acquire Landmark Aviation.
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The proposed deal would merge BBA Aviation’s Signature Flight Support business, which has the highest number of fixed base operations (FBO) in the United States, with Landmark’s, which has the third highest, in a market that continues to remain highly fragmented.
The British aircraft services provider confirmed this morning that it was making a $2.065bn offer for the Carlyle Group-owned business, which will be partly funded through a £748m rights issue.
Landmark is one of the largest FBO networks in the world with 68 sites, 64 of which are in North America and four in Europe.
Landmark Aviation has been exploring a sale as the corporate jet market is slowly recovering from a downturn sparked by the global financial crisis, helping valuations for companies offering services to that industry.
“This is a transformational step in the continued execution of BBA Aviation’s strategy that is…”
However investors were unconvinced: BBA’s share price was down 2.3 per cent at pixel time. The Acqusition deepens the Company’s exposure to the attractive business and general aviation market with its structural growth drivers.
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Combined costs will be $35 million lower, although the costs of the deal will be $25 million and the company is planning investments of $19 million.
