Gama Aviation PLC Acquisition of 51% of Gama Group Mena FZC (9175T)
18 October 2017 - 5:00PM
UK Regulatory
TIDMGMAA
RNS Number : 9175T
Gama Aviation PLC
18 October 2017
18th October 2017
Gama Aviation Plc (AIM: GMAA)
("Gama Aviation" or the "Company")
Acquisition of 51% of Gama Group Mena FZC
Background
As part of the original Jet Set Equity Partners Limited (FZC)
("Jet Set") investment into Gama Aviation in 2008, Gama Aviation
and Jet Set agreed to establish a start-up operation in the Middle
East to provide Air and Ground services regionally. Jet Set is a
consortium of local private equity investors comprising Growthgate
Capital Corporation BSC (C) Bahrain, Crescent Investment LLC and
Felix Tr. Co. LLC ("Felix") each of whom is currently a share
holder of the Company. Under the terms of this original investment,
a regional holding company for the Air and Ground divisions, Gama
Group MENA FZC ("Gama MENA"), was formed with the Company holding a
49% equity interest and Jet Set owning the remaining 51%. Gama
Group MENA FZC provides aircraft management and chartering through
its subsidiary Gama Aviation FZE (the ME Air division) and aircraft
maintenance and FBO services through its Gama Support Services FZE
subsidiary (the ME Ground division).
Acquisition of Jet Set interest
Today Gama Aviation announces the acquisition of the 51% Jet Set
interest in Gama MENA for a cash consideration of $5.1m. Following
the acquisition, the Company will own 100% of Gama MENA.
Consistent with worldwide regulations governing the foreign
ownership of air carriers nationally, Gama MENA has divested a 51%
equity interest in Gama Aviation FZE, its ME Air Division, to Felix
for a nominal consideration. Under an agreement between
shareholders, Gama MENA will retain management and operational
control of the ME Air Division and will be entitled to 80% of the
dividends paid by Gama Aviation FZE. In addition, Gama MENA will
receive a branding fee of 0.5% of the revenues of Gama Aviation
FZE.
Benefits and Financial effects of the transaction
In the year ended 31 December 2016, Gama MENA achieved revenues
of $24.7m and profit before tax of $0.2m. Gama Aviation believes
that there are significant growth opportunities in the Middle East
generally. In particular, new compliance requirements in Saudi
Arabia and the development of the Business Aviation Centre in
Sharjah, UAE, present attractive aircraft management opportunities
which are also expected to drive growth in maintenance and FBO
services. Gama Aviation has therefore decided to increase its
economic interest and management control in Gama MENA at a time
when the business is well placed to grow and develop this market
opportunity.
This transaction between Gama Aviation and Jet Set is considered
to be a related party transaction for the purposes of AIM Rule 13,
and accordingly the Board, having consulted with Jefferies
International, the Company's nominated adviser, considers the terms
of the transaction to be fair and reasonable insofar as the
Company's shareholders are concerned.
This announcement contains inside information.
End
Gama Aviation Plc +44 1252 553 010
Marwan Khalek, Chief Executive
Kevin Godley, Finance Director
Camarco +44 (0) 20 3757 4992
Ginny Pulbrook
Geoffrey Pelham-Lane
Jefferies International +44 207 029 8000
(Nominated Advisor & Broker)
Simon Hardy
Will Soutar
Gama Aviation - Notes to Editors
Gama Aviation (GMAA) is a global business aviation services
company that specialises in providing support for individuals,
corporations and government agencies. Gama Aviation is now one of
the top three global players in a highly fragmented market, with a
fleet of over 250 aircraft. Gama operates across Europe, the US,
the Middle East, Asia and Africa.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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October 18, 2017 02:00 ET (06:00 GMT)
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