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Macquarie Infrastructure Corporation (MIC) and KKR have signed a definitive agreement for MIC to sell its Atlantic Aviation business to US private equity company, KKR. The deal worth $4.475bn in cash and assumed debt and reorganisation obligations will see KKR take over one of the largest FBO networks in the US.
Jefferies acted as financial advisor to KKR, the US-based investment bank has now advised on the two largest FBO transactions. The other deal was Bill Gates’ Cascade Investment and Blackstone’s takeover of Signature Aviation earlier this year.
“We are proud of the robust growth Atlantic Aviation has achieved under our ownership, which resulted in strong interest from prospective buyers during the sale process,” said Christopher Frost, CEO MIC. “We are pleased with the outcome of the sale process and the unlocking of additional value for MIC shareholders. In addition to the timely closing of a sale of Atlantic Aviation, our focus remains on successfully concluding the sale process for our MIC Hawaii business.”
The purchase price implies a multiple of Atlantic Aviation’s 2019 Earnings Before Interest Taxes and Depreciation and Amortisation (EBITDA) of 16.2 times. MIC said it expects to receive $3.525bn at closing following the reorganisation of MIC into a limited liability company, Macquarie Infrastructure Holdings LLC. This was approved by MIC shareholders on May 6th and is expected to be completed shortly before the closing of the Atlantic Aviation sale.
The sale of is expected to close in the fourth quarter of this year, subject to regulatory and shareholder approvals. MIC expects to seek approval of the Atlantic Aviation sale at a meeting of shareholders to be conducted as soon as possible.
Dash Lane, partner at KKR, said: “Atlantic Aviation has an outstanding reputation as a leading operator of critical aviation infrastructure across the US. With our focus on providing long-term capital to support the growth of high quality and resilient businesses, we are excited to invest alongside Atlantic’s experienced team and strong existing platform which we believe is well positioned to capitalise on multiple avenues of future growth.”
KKR is making its investment in Atlantic Aviation primarily through its Global Infrastructure Investors and Core Investments strategies. Kirkland & Ellis acted as legal advisor to KKR for the deal. Lazard and Evercore acted as financial advisors and White & Case acted as legal advisor to MIC.