John Menzies PLC (LSE:MNZS) said it agreed a 608p per share bid for the company, valuing the UK airport services group at about £571mln on a fully diluted basis.
The bid from a subsidiary of Kuwaiti aviation services provider Agility Public Warehousing Co is at roughly a 81% premium to the share price on the last day of trading before the commencement of the offer period.
A statement said the terms of the deal are final and will not be increased, but added the Kuwaiti group reserves the right to increase the offer if there is a rival bid.
The deal implies an enterprise value multiple of approximately 10.7 times Menzies' underlying earnings before interest tax and depreciation for the year ended 31 December 2021 on a pre-IFRS 16 basis.
Following completion of the deal, Agility will combine Menzies' business with its existing wholly-owned subsidiary, National Aviation Services (NAS).
“Menzies is a good fit,” Tarek Sultan, Vice-Chairman of Agility, said. “The aviation sector has strong growth potential, and Menzies is one of the most-established providers in the industry, with a sustainability focus we share.
“A NAS-Menzies combination will create a strong and resilient industry player, well positioned to grow and drive future earnings. We expect this acquisition to further diversify Agility's revenue base and strengthen cash flow generation."
In 2021, Menzies and NAS generated combined revenues exceeding US$1.5bn.
On a fully diluted basis, the acquisition values Menzies at approximately £571mln, and on an enterprise value basis, Menzies is valued at approximately £763mln.
Shares in John Menzies were 4% at 593p in early deals.