Equitix buys Babcock’s stake in AirTanker for £126 million

Equitix buys Babcock’s stake in AirTanker for £126 million

LONDON, UK: Babcock International has entered into a definitive agreement with Equitix Investment Management Limited for the sale of its 15.4% shareholding in AirTanker Holdings Limited for a cash consideration of £126 million, including the repayment of shareholder loans of £31.1 million1, subject to any routine closing adjustments and before transaction costs.

AirTanker Holdings is an asset joint venture with Airbus, Thales and Rolls-Royce, owning fourteen A330 Voyager aircraft to support air-to-air refuelling, air transport and ancillary services for UK Ministry of Defence. Babcock retains its 23.5% shareholding in AirTanker Services Limited, which operates these aircraft.

AirTanker Holdings is part of Babcock’s Aviation sector and is accounted for by Babcock as an associate. For the year ended 31 March 2021, Babcock’s share of associate income, included within the Group’s loss, was £(1.1) million and AirTanker Holdings had gross assets of £2.7 billion.

The sale is part of Babcock’s ongoing targeted disposal programme, which aims to generate at least £400 million of proceeds. Proceeds from this transaction will be used to reduce net debt.

The deal is expected to complete by the end of this financial year, and is subject to regulatory approvals given the industry AirTanker Holdings operates in. There is no merger control condition. Remaining AirTanker shareholders have pre-emption rights over the Babcock shares.

The agreement constitutes a class 2 transaction for the purposes of the UK Financial Conduct Authority’s Listing Rules, and as such does not require Babcock shareholders’ approval.

Babcock CEO David Lockwood said: “This the third disposal we have announced as part of our ongoing programme to streamline the Group and, should all complete, ensures we will meet our target of generating at least £400 million of disposal proceeds this financial year. We are pleased to continue to maintain an interest in AirTanker through our work with AirTanker Services.”

Equitix is a leading investor, developer and long-term fund manager of core infrastructure and renewable energy assets in the UK and Europe. Equitix has raised £7 billion of equity, including managed accounts, and is governed by seven senior investment professionals with more than 130 years of public-sector industry experience between them.

The investment strategy for the funds focuses on small to mid-sized infrastructure projects located in the UK and Europe across a wide range of sectors but with a focus on social infrastructure, renewable energy and utilities. Equitix seeks to hold assets for the life of all its core funds.

With over 300 core infrastructure projects acquired since the firm’s inception in 2007, Equitix has institutionalised its distinctive approach to infrastructure investing and has demonstrated a predictable rate of deployment for over ten years.

Equitix has established a strong reputation as a leading developer, trusted partner, operator and fiduciary fund manager.

Babcock International Group PLC share price

341.08 GBX

13 Sep, 8:03 am GMT+1 ·Disclaimer


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