Air Transport Services Group (ATSG), a global company in medium widebody freighter aircraft leasing, air transport operations and support services, has entered into a definitive agreement to be acquired by Stonepeak, an alternative investment firm specializing in infrastructure and real assets, in an all-cash transaction with an enterprise valuation of approximately $3.1 billion.
Under the terms of the definitive agreement, which was unanimously approved by ATSG’s board of directors, holders of ATSG’s common shares will receive $22.50 per share in cash. The purchase price represents a premium of approximately 29.3% over ATSG’s closing share price on Nov. 1, 2024, the last full trading day prior to this announcement, and a 45.5% premium over ATSG’s volume-weighted average price (VWAP) over the prior ninety trading days. Upon completion of the transaction, ATSG’s shares will no longer trade on NASDAQ, and ATSG will become a private company.
“The agreement with Stonepeak will deliver immediate and certain cash value to ATSG’s shareholders at a substantial premium to recent market prices. With a history dating back to 1980, we are excited to reach this important milestone in our journey,” Joe Hete, executive chairman of ATSG’s board of directors, said. “Since going public in 2003, ATSG has diversified and expanded its portfolio of companies and services, becoming a global leader in midsize freighter leasing and flying, as well as a leading supplemental provider of passenger transport for the U.S. Department of Defense and other agencies. Following the board’s careful evaluation of the transaction, we are confident it is the best path forward and maximizes value for ATSG’s shareholders, while also benefiting our employees, customers, partners, communities and other stakeholders.”
“This transaction reflects the tremendous value of our fleet of in-demand midsize freighter and passenger aircraft, and the strength of our talented teams across ATSG’s businesses,” Mike Berger, CEO of ATSG, said. “In Stonepeak, we have found a partner that recognizes the power of our Lease+Plus strategy to provide comprehensive aircraft leasing and operating solutions to our customers. With Stonepeak’s investment and extensive expertise in transportation and logistics and asset leasing, ATSG will be well positioned to further expand its global presence in the air cargo leasing market and enhance its service offerings to customers. We would like to thank our employees for helping us achieve this significant milestone and for their continued dedication as we prepare to enter this new chapter as a private company.”
“ATSG plays a fundamental role in enabling the growth of e-commerce globally in a world that continues to shift away from brick-and-mortar shopping,” James Wyper, senior managing director and head of transportation and logistics at Stonepeak, said. “ATSG’s deep relationships with some of the world’s largest e-commerce companies and integrators, combined with the scale and capacity of their fleet and relentless focus on safety and on-time performance, gives us confidence in the company’s trajectory as a sector leader.”
“We look forward to supporting the team at ATSG to help take the business to the next level as a private company, and are excited about this addition to our North American infrastructure investment strategy,” Graham Brown, managing director of Stonepeak, said.
The transaction is expected to close in H1/25, subject to customary closing conditions, including approval of ATSG’s shareholders and receipt of regulatory approvals. The transaction has fully committed equity financing from funds affiliated with Stonepeak and fully committed debt financing. The transaction is not subject to a financing condition.
The definitive agreement includes a “go-shop” period. Under the terms of the merger agreement, ATSG may solicit proposals from third parties for a period of 35 days continuing through Dec. 8, 2024, and, in certain cases for a period of 50 days continuing through Dec. 23, 2024. In addition, ATSG may, at any time prior to receipt of shareholder approval, subject to the provisions of the merger agreement, respond to unsolicited proposals that constitute or would reasonably be expected to result in a superior proposal. ATSG will have the right to terminate the merger agreement with Stonepeak to enter into a superior proposal subject to the terms and conditions of the merger agreement, including payment of a customary termination fee. There can be no assurance that the solicitation process will result in a superior proposal or that any other transaction will be approved or completed. ATSG does not intend to disclose developments with respect to this solicitation process unless and until its Board of Directors determines such disclosure is appropriate or otherwise required.
Goldman Sachs is acting as exclusive financial advisor to ATSG. Davis Polk & Wardwell and Vorys, Sater, Seymour & Pease are acting as legal counsel to ATSG. Evercore is acting as financial advisor to Stonepeak. Simpson Thacher & Bartlett and Hogan Lovells US are acting as legal counsel to Stonepeak.
