gretel
29 Dec 2014
Profits to double post-merger Interesting from this new Shares Mag article that "profits could double over the next three years". That would imply say 45p-50p EPS, which would further suggest a share price between say 750p-1000p.Very nice indeed:"A proposed reverse takeover of global business aviation services group Gama by Hangar8 (HGR8:AIM) is a faster route to scaling up operations to compete in a growing global market place and has lit a fire under the company’s share price. If successful, the deal will lead to the newly named Gama Aviation being one of the five largest operators globally in the privately owned passenger jet aircraft space. Hangar8 is up more than 29% year-to-date as the manager and operator of privately owned passenger jet aircraft has been shifting its strategic focus away from the traditional short-term charter revenues and more towards a dedicated full-service management operation. A growing range of in-house services is being complemented by new additions to the fleet. This is seeing Hangar 8 make a concerted effort to replace smaller light jets with long-range heavy jets in response to the growing market demand for intercontinental business air travel. The group now has 27 long range heavy and super-heavy aircraft out of a fleet of 47 revenue- generating aircraft overall. In November total revenues for the year to the end of June came in 26% higher at £65 million. At the same time, gross profit came in 25% higher at £10.3 million. Over the past two years, the group has consistently delivered gross margins at 16% and adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) in the year to June was up 32% at £2.66 million.House broker Cantor Fitzgerald sees the deal generating strong profit growth and free cash.The two businesses certainly enjoy a complementary geographical coverage; they have a good operational fit and have been pursuing similar growth strategies built on a profitable and apparently robust business model. Cantor maintains that ‘profits could double over the next three years due to a planned increase in aircraft under management, cross-selling of services, cost synergies, further development of ground operations such as engineering, and growth in Asia through a new strategic partnership.’...... If successful, the Gama deal will see the emergence of a global player and a one-stop shop for specialist services in the private jet segment."
gretel
22 Dec 2014
More acquisitions likely soon... The share price certainly took going ex-div last Thursday nicely in its stride!And this article promises more excitement to come, with more acquisitions etc...[link] "Gama8 - a global business jet operator with 144 aircraft under management Published: 20 December 2014 Written by INT821 The merger of Hangar8 and Gama Aviation is a significant one. It will result in a global business jet operator with 144 aircraft under management and revenues of more than £250 million ($400 million) based on 2013 revenues. The merger of Hangar8 and Gama Aviation is a significant one. It will result in a global business jet operator with 144 aircraft under management and revenues of more than £250 million ($400 million) based on 2013 revenues. The logic behind the merger is sound and there is little geographic overlap. It is an exciting opportunity for both companies. Since it listed in 2010, Hangar8 has doubled both the number of aircraft it manages and its share price. Gama Aviation could grow just as fast. But it is not even the start of the beginning of operator consolidation. After the merger, Gama Aviation’s market share in both the US and Europe will still be under 2%. In fact, if you add together all of the operators in the world which manage 100 aircraft they still account for less than 10% of the fleet. With 75% of US operators and 80% of European operators managing less than five aircraft it is hard to think of any more fragmented global industry. The most exciting transactions will be the ones Gama does from now on. As a listed company it will have access to capital and as soon as the deal formally closes it will start looking for new acquisitions. As well as growing organically. Marwan Khalek, Gama’s CEO, says that there is still a place for smaller operators (Gama itself started with one Beech Barron) but he is confident there will be more acquisition opportunities. He adds: “It is becoming a harder market and operators are battle-weary both because of regulations and the market.”"
gretel
09 Dec 2014
Re: Goodbye Hangar8, Hello Gama Aviation plc Agreed. This sems a good move to me at first look.This will now be a much larger group, with much more interest for institutional investors - and will be much more liquid than HGR8 ever is or was.Lots of synergies and savings to be had it seems. Not a bad placing price at 280p either. DD has placed around 23% of his shares, but retains the other 77%.Here's the full document FYI:[link] all, as this article suggests, the merger will make HGR8 "one of the five leading operators in business aviation worldwide".This is now a serious player and will be a draw for institutional investment.Since HGR8 was already pretty good value given EPS forecasts and the cash pile, I expect the share price to do well from here:[link] "Hangar 8 and Gama Aviation to merge and become one of the world's top 5Posted 9 December 2014 · Add CommentTwo leading British business aviation companies with interests in the Middle East and Africa, Hangar 8 and Gama Aviation, are to merge. The new company, to be called Gama Aviation plc, will have a market capitalisation of £120 million (about $188 million) and make it one of the five leading operators in business aviation worldwide. The merged company will manage 144 aircraft and operate from 44 different locations in 15 countries across five continents. It will have a strong presence in North America, the UK, continental Europe, Africa, Middle East and Asia as well as South America. It will offer a comprehensive service, operating and supporting aircraft from all major manufacturers and all classes of private jet aircraft. Dustin Dryden, Chief Executive of Hangar8 said: "Hangar8 has achieved much in its short history but, in our highly regulated industry, success at all levels is now entirely driven by scale. Today our clients, many with ultra-long range aircraft, require their premier suppliers to be truly global too with the ability to supply a full range of private aviation services across the globe" etc"
sharegardener
08 Dec 2014
Goodbye Hangar8, Hello Gama Aviation plc At first glance this looks like a good opportunity for more growth -It will result in a much bigger company with wider reach and more diverse operations, maintenance capability etc.The 'concert party' will however own approx 60% of the shares in the new company. The CEO will be the current Gama owner with Dustin Dryden being one of two exec directors, the other also from Gama.New share placing price is 280p but placing is not underwritten.Any views? SG
