SATS, a Singapore-based cargo handling service, is all set to buy Worldwide Flight Services (WFS) from an affiliate of asset investor Cerberus Capital Management in a deal with an enterprise value of €2.25bn. The deal will be the biggest acquisition by SATS, having a market value of $3 billion.
This acquisition will bring together WFS, the air cargo handler with operations in the Americas and Europe, and SATS, a cargo service provider in Asia, creating the largest global cargo handler, responsible for more than 50% of global air cargo volume and positioning SATS as the largest cargo handler globally, managing over 9 million tonnes of cargo, SATS said in a statement.
The transaction is subject to customary regulatory and SATS shareholders’ approval and is expected to close by March 31, 2023. WFS was advised by Goldman Sachs as an exclusive financial advisor, Linklaters as lead counsel, and Deloitte as tax advisor.
Craig Smyth, WFS CEO, said: “WFS has become the leading global air cargo logistics provider thanks to our commitment to customers, our experienced team, and our partners at Cerberus. As we look to our next stage of growth, this combination will deliver exciting benefits for our customers and our people. We have great respect for SATS and enjoy similar values. By bringing together our respective strengths, we will be able to build on our trusted relationships around the world.”
Kerry Mok, SATS CEO, commented: “WFS is an industry leader because it has dedicated people and an unwavering commitment to customers. Our proposed acquisition is a transformational opportunity for SATS and will create a global leader and a go-to provider of mission-critical aviation services. In our newly combined markets, SATS and WFS will be at the heart of global trade flows, operating in the world’s busiest airports and supporting the biggest companies.”
Cerberus bought WFS In June 2018, in a deal worth €1.2bn.
Cerberus managing director Craig Brooks commented: “It has been a privilege to work alongside the talented WFS team and support the company in reaching new heights. Over the past four years, WFS has become a global leader by growing its network and investing in technology, operating capabilities, and customer solutions. SATS is a great partner for WFS and the combination will enhance growth and the value proposition for customers.”
Following the close of the transaction, WFS will become a wholly owned subsidiary of SATS and the WFS management team will continue to lead the business.
This combination will create a global air cargo platform with scale and a network of stations across Asia, the Americas, and Europe giving the customers a broader suite of services, operational best practices, and integrated technology, a joint statement said.
WFS has over 30,000 employees serving over 300 customers at 164 major airports in 18 countries across five continents with an annual turnover of €1.8bn
SATS was advised by BofA Securities as lead financial advisor, DBS Bank as financial advisor, Latham & Watkins as lead counsel, and Allen & Glaedhill as Singapore counsel, with PwC Advisory Services giving transaction advisory support
SATS has a customer base in over 60 locations covering 14 countries across the Asia Pacific, the UK, and the Middle East.