ATSG Acquires Equity Interest in West Atlantic AB; Terms Undisclosed
Air Transport Services Group (Nasdaq: ATSG), today announced that it has agreed to acquire a 25 percent equity interest in West Atlantic AB of Gothenburg, Sweden.
West Atlantic AB, through its two airlines, Atlantic Airlines Ltd. and West Air Sweden AB, operates a portfolio of 40 aircraft, and is Europe's largest regional cargo aircraft operator. As an experienced provider of unique, integrated ground-to-air logistics for the mail industry in the five to 20 tonne segment, it offers highly customized services to the global market utilizing its fleet of BAe ATPs, CRJ-200-PFs, and B737 aircraft. In addition, Atlantic Airlines Ltd. is currently adding the B767 to its operating capability. Through its aircraft leasing company, European Turboprop Management AB, West Atlantic also offers its customers a dry lease option. Base maintenance and line maintenance control services are provided through European Aircraft Maintenance Ltd., another West Atlantic AB subsidiary.
Joe Hete, President and Chief Executive Officer of ATSG, said, “This investment and our expanded working relationship with West Atlantic's management team represents a commitment from ATSG toward an increasing role in the growth of the air-cargo market in the EMEA Region and throughout West Atlantic's range of operations. Our leading position in the medium widebody freighter market and global reputation for delivering complete medium-size freighter solutions to major logistics services providers, together with West Atlantic's complementary strengths in providing time-definite air cargo services in Europe, make us ideally suited to work together on emerging opportunities.”
The agreement is expected to close on Jan 2, 2014. The cash consideration to be paid in January 2014 for the equity interest is significantly less than ATSG's historical cost to purchase and modify a single 767 aircraft and is anticipated to generate strong returns. ATSG will disclose additional information about the investment in its year-end 10K filing.
Gustaf Thureborn, Managing Director and Chief Executive Officer of West Atlantic, welcomed ATSG's investment. He noted that both companies foster a strong culture of commitment to their employees and communities, as well as service excellence for their customers.
“We look forward to working with ATSG to augment West Atlantic's own fleet and air cargo service capabilities,” Thureborn said. “ATSG has nearly 50 Boeing 767 freighter aircraft, more than 30 years of experience providing highly reliable air network performance, integrated maintenance programs specifically tailored to express networks, and an array of additional resources including engines, parts, and technical support that will extend our own strong capabilities in these areas.”
ATSG is a leading provider of aircraft leasing and air cargo transportation and related services to domestic and foreign air carriers and other companies that outsource their air cargo lift requirements. ATSG, through its leasing and airline subsidiaries, is the world's largest owner and operator of converted Boeing 767 freighter aircraft, with 47 as of September 30, 2013. Through its principal subsidiaries, including two airlines with separate and distinct U.S. FAA Part 121 Air Carrier certificates, ATSG provides aircraft leasing, air cargo lift, aircraft maintenance services and airport ground services. ATSG's subsidiaries include ABX Air, Inc.; Airborne Global Solutions, Inc.; Air Transport International, Inc.; Cargo Aircraft Management, Inc.; and Airborne Maintenance and Engineering Services, Inc. For more information, please see www.atsginc.com.
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