– Flexjet has entered into a business
combination agreement with Horizon Acquisition Corporation II
(“Horizon”) (NYSE: HZON); the combined company is expected to trade
on the NYSE
– Flexjet’s unique platform provides Fractional
Jet Ownership; Private Jet Leasing; Jet Cards; On-Demand Charter
and Full Ownership to a highly loyal and growing clientele
– Multi-decade track record of recurring
profitable growth with projected estimated 2022 revenue of $2.3
billion, and estimated 2022 Adjusted Management EBITDA of $288
million*
– Transaction implies a pro forma enterprise
value for Flexjet of approximately $3.1 billion and is anticipated
to close in the second quarter of 2023
– Transaction proceeds are expected to fund
fleet, program, and geographic expansion, as well as significant
infrastructure expansion, including maintenance support facilities
and private terminals
– World-class management team with 40+ years of
industry experience and proven track record for driving innovation
and growth through focused financial discipline and capital
stewardship.
Flexjet, Inc. (the “Company”), a global leader in
subscription-based private aviation, and Horizon Acquisition
Corporation II (“Horizon”) (NYSE: HZON), a publicly traded special
purpose acquisition company, announced today a definitive business
combination agreement that will result in Flexjet becoming a
publicly listed company. Upon the closing of the transaction,
Flexjet is expected to be listed on the NYSE under the ticker
symbol “FXJ.”
This press release features multimedia. View
the full release here:
https://www.businesswire.com/news/home/20221011005751/en/
Flexjet's Gulfstream G650 and Sikorsky
S-76 (Photo: Business Wire)
Flexjet is a global leader in the private aviation sector with a
full breadth of market offerings that reach private jet users
through various branded storefronts that target specific private
flying needs. These storefronts include: Flexjet, which focuses on
fractional jet ownership and leasing; Sentient Jet, which focuses
on jet cards; FXAIR and PrivateFly, which offer on-demand charter
programs; as well as Sirio, which focuses on full aircraft
ownership.
The Company’s subscription-based recurring revenue model
provides the basis for predictable revenue and cash flow. This
subscription-based recurring revenue comes from a large, committed
customer base of ultra-high-net-worth individuals and Fortune 500
corporations through approximately 10,000 committed contracts.
Flexjet’s customers are highly loyal, demonstrated through a 97%
retention rate and long-tenured relationships. Over 35% of
Flexjet’s fractional customers have been with the Company for more
than 10 years and 55% have been with the Company for more than five
years.
For over 25 years, Flexjet has set the standard in private
aviation with exceptional service and award-winning safety
programs, providing its loyal and growing customer base with
precise, efficient, and personalized experiences on every trip.
Today, the Company delivers unrivaled travel experiences with a
fleet of over 250 aircraft and helicopters and a global aviation
infrastructure network. The Company’s unique pilot operating model
referred to as “Dedicated Crewing” is one that assigns pilots to
one specific airplane N-number. This provides an extremely
comfortable and safe environment for the Company’s flight crews and
the familiarity with their aircraft increases dispatch reliability
over similar aircraft not flown with dedicated crews. In
conjunction with its dedicated crews, Flexjet has made a commitment
to maintaining the highest compensation among its pilot peer group
as well as attractive work rules, making Flexjet an employer of
choice and reducing pilot attrition during an extremely competitive
pilot hiring environment. Flexjet’s average pilot new hire has more
than twice the flight hour minimum required for application and 36%
of our pilots have been with the Company for more than 15
years.
Flexjet’s distinctive business model, innovative and unique
service delivery, proven subscription-based model with consistent
profitability, and world-class management team, set it apart from
its private aviation industry peers. The Company’s global reach
consists of 3,100 employees, including 1,000 nonunion pilots and
450 licensed maintenance technicians across nine office locations
in the United States, United Kingdom, and Italy.
Flexjet’s maintenance infrastructure and capabilities are the
largest of any private aircraft operator and are a foundational
element to all aircraft operations. Competent, timely and
coordinated servicing has a crucial impact on fleet readiness and
dispatch availability. Flexjet achieves this through a network of
20 mobile maintenance support units that are based throughout the
United States and a network of partner facilities across the globe.
This unique and innovative investment in one of the most robust
maintenance infrastructure networks in the industry ensures
consistent and exemplary service and safety, and the integrity of
key revenue streams through a relentless focus on aircraft dispatch
reliability.
Management Commentary
“Having capital and currency will position us to expand market
share at an accelerated pace in an opportunistic environment,” said
Kenneth Ricci, Chairman of Flexjet. “We will parlay our existing
profitability and use that as a launch pad to accelerate our growth
into the next chapter. We are making this decision at a time when
we believe the marketplace is expanding at a more aggressive rate.
Additionally, the collective infrastructure necessary to operate
this model would be very difficult to replicate. Accumulating the
aircraft, customer base, global infrastructure, technology, and
most importantly, the culture, would take years, if not
decades.”
Continued Ricci, “We place a tremendous focus on capital
deployment and return on invested capital, and we have an extremely
talented management team that has built this company in a very
capital-efficient way. We have the infrastructure, we have
tremendous depth and commitment from our employee group, and we
have a vision.”
“Flexjet’s global presence, aircraft network, and proprietary
technology have established the Company as a category leader in
private aviation. Eldridge has a long-tenured partnership with this
world-class management team and believe that the scale and breadth
of Flexjet’s solutions will enable it to continue to capture share
in a large and accelerating market,” said Todd Boehly, CEO, CFO and
Chairman of Horizon. “I’ve known Kenn and the team for nearly a
decade, and their ability to profitably grow Flexjet to what is
estimated to be over $2 billion in revenue through an unrivaled
product offering and desirable subscription-based business model
sets the team apart. We believe this transaction provides Flexjet
with ample capital to execute Flexjet’s long-term vision, the
ability to continue to serve its loyal customer base, and positions
the Company for success in the public markets.”
Transaction Overview
The transaction values the combined company at a pro forma
enterprise value of $3.1 billion, representing 10.8x projected 2022
Adjusted Management EBITDA of approximately $288 million. The
majority of proceeds in the business combination are expected to be
held on the Company’s balance sheet.
The transaction is backstopped with an up to $300 million common
equity capital commitment from Eldridge Industries (an affiliate of
Horizon’s sponsor) and Horizon’s sponsor, which consists of $155
million in non-redemption agreements and an up to $145 million
redemption back-stop. Upon the closing of the transaction and
assuming the full redemption back-stop is utilized, existing
Flexjet shareholders (which includes affiliates of Eldridge
Industries who are current investors in Flexjet) are expected to
own 89% of the combined company. In the event there are fewer
redemptions from Horizon’s trust account, such ownership percentage
would be reduced by existing Horizon public shareholders.
The boards of directors for both Flexjet and Horizon have
approved the proposed business combination, which is expected to be
completed in the second quarter of 2023, subject to shareholder
approvals and other customary closing conditions, as well as
successful completion of the pending solicitation of shareholders
to extend Horizon’s period to complete a business combination
transaction.
Investor Conference Call and Webcast
Flexjet and Horizon will host a joint investor conference call
to discuss the business and the proposed transaction today, October
11, 2022, at 8:30 a.m. ET.
To listen to the conference call via telephone, dial (877)
269-7751 (U.S.) or (201) 389-0908 (international callers/U.S. toll)
and enter the conference ID number 13733295. To listen to the
webcast, please click here. A webcast replay will be available for
one year. A telephone replay will be available until Tuesday,
October 25, 2022 at (844) 512-2921 using the conference ID number
13733295.
For Investor Relations, including a copy of an investor
presentation as filed with the SEC, please visit the Flexjet
website at https://investors.flexjet.com or the SEC’s website for
Horizon’s filings at
https://www.sec.gov/edgar/browse/?CIK=1821788&owner=exclude.
Advisors
Credit Suisse Securities (USA) LLC served as lead financial and
capital markets advisor, Deutsche Bank Securities Inc. served as
capital markets advisor and RBC Capital Markets, LLC served as
financial and capital markets advisor to Horizon. Houlihan Lokey
Capital, Inc. served as financial advisor to a special committee of
independent directors of the Board of Directors of Horizon.
White & Case LLP is serving as legal advisor to Flexjet,
Sidley Austin LLP is serving as legal advisor to Horizon, Skadden,
Arps, Slate, Meagher & Flom LLP is serving as legal counsel to
Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc.
and RBC Capital Markets, LLC and Sullivan & Cromwell LLP is
serving as legal counsel to Houlihan Lokey Capital, Inc.
About Flexjet
Flexjet, Inc. reaches private jet users through various
storefronts that include Flexjet, Sentient Jet, FXAIR, PrivateFly,
and Sirio. Focusing on fractional jet ownership and leasing, jet
cards, on-demand charter programs, and full aircraft ownership,
each storefront has a unique business model and go-to-market
strategy. Flexjet’s U.S. fractional aircraft program is the first
in the world to be recognized as achieving the Air Charter Safety
Foundation’s Industry Audit Standard, is the first and only company
to be honored with 22 FAA Diamond Awards for Excellence, upholds an
ARG/US Platinum Safety Rating, received a 4AIR Bronze
Sustainability Rating and is IS-BAO compliant at Level 2. In
Europe, Flexjet is compliant with IS-BAO, is a Wyvern Wingman
Certified Operator and holds a 4AIR Silver Sustainability Rating.
In 2015, Flexjet introduced Red Label by Flexjet, which features
the most modern fleet in the industry, flight crews dedicated to a
single aircraft and the LXi Cabin Collection of interiors. To date,
Flexjet’s fleet in the U.S. includes the Embraer Phenom 300 and
Praetor 500, the Bombardier Challenger 350, and the Gulfstream G450
and G650. Flexjet’s European fleet includes the Embraer Praetor 600
and the Gulfstream G650. Flexjet’s helicopter division sells
fractional, lease, and on-demand charter access to its fleet of
owned and operated Sikorsky S-76 helicopters serving locations
throughout the northeastern United States, United Kingdom and
Florida. Flexjet is a member of the Directional Aviation family of
companies. For more details on innovative programs and flexible
offerings, visit www.flexjet.com or follow us on Twitter @Flexjet
and on Instagram @FlexjetLLC.
About Horizon Acquisition Corporation II
Horizon Acquisition Corporation II is a blank check company
incorporated for the purpose of effecting a merger, share exchange,
asset acquisition, share purchase, reorganization or similar
business combination with one or more businesses. Horizon is
sponsored by Horizon Sponsor LLC, an affiliate of Eldridge
Industries, LLC (“Eldridge”). Horizon is led by Todd L. Boehly, the
Co-founder, Chairman and Chief Executive Officer of Eldridge.
Horizon’s securities are traded on the New York Stock Exchange (the
“NYSE”) under the ticker symbols HZON, HZON WS and HZON.U. Learn
more at https://www.horizonacquisitioncorp-ii.com/
Additional Information and Where to Find It
In connection with the Business Combination, Horizon and Flexjet
intend to prepare, and Flexjet intends to file with the SEC, a
Registration Statement on Form S-4 (the “Registration Statement”), and Horizon and Flexjet
intend to prepare, and Horizon intends to file with the SEC, a
preliminary proxy statement/prospectus and, when available, a
definitive proxy statement and final prospectus. When available,
Horizon will mail the definitive proxy statement/prospectus and
other relevant documents to its shareholders as of a record date to
be established for voting on the Business Combination. This
communication is not a substitute for the Registration Statement,
the definitive proxy statement/prospectus or any other document
that Horizon will send to its shareholders in connection with the
Business Combination. Investors and security holders of Horizon are
advised to read, when available, the preliminary proxy
statement/prospectus in connection with Horizon’s solicitation of
proxies for its extraordinary general meeting of shareholders to be
held to approve the Business Combination (and related matters) and
general amendments thereto and the definitive proxy
statement/prospectus because the proxy statement/prospectus will
contain important information about the Business Combination and
the parties to the Business Combination.
Copies of the preliminary proxy statement/prospectus, the
definitive proxy statement/prospectus and other documents filed by
Horizon or Flexjet with the SEC may be obtained, once available,
free of charge at the SEC’s website at www.sec.gov.
Forward Looking Statements
Certain statements made in this press release and the documents
incorporated by reference herein are “forward looking statements”
within the meaning of the “safe harbor” provisions of the United
States Private Securities Litigation Reform Act of 1995.
Forward-looking statements can be identified by words such as:
“target”, “believe”, “expect”, “will”, “shall”, “may”,
“anticipate”, “estimate”, “would”, “positioned”, “future”,
“forecast”, “intend”, “plan”, “project”, “outlook” and other
similar expressions that predict or indicate future events or
trends or that are not statements of historical matters. Examples
of forward-looking statements include, among others, statements
made in this press release regarding the proposed transactions
contemplated by the Business Combination agreement, including the
benefits of the Business Combination, integration plans, expected
synergies and revenue opportunities, anticipated future financial
and operating performance and results, including estimates for
growth, the expected management and governance of the combined
company, and the expected timing of the Business Combination.
Forward-looking statements are neither historical facts nor
assurances of future performance. Instead, they are based only on
Horizon’s and the Company’s managements’ current beliefs,
expectations and assumptions. Because forward-looking statements
relate to the future, they are subject to inherent uncertainties,
risks and changes in circumstances that are difficult to predict
and many of which are outside of our control. Actual results and
outcomes may differ materially from those indicated in the
forward-looking statements. Therefore, you should not rely on any
of these forward-looking statements.
Important factors that could cause actual results and outcomes
to differ materially from those indicated in the forward-looking
statements include, among others, the following: (1) the occurrence
of any event, change, or other circumstances that could give rise
to the termination of the Business Combination agreement; (2) the
outcome of any legal proceedings that may be instituted against
Horizon or Flexjet following the announcement of the Business
Combination agreement and the transactions contemplated therein;
(3) the inability to complete the proposed Business Combination,
including due to failure to obtain approval of the stockholders of
Horizon and the Company, certain regulatory approvals, or satisfy
other conditions to closing in the business combination agreement;
(4) the occurrence of any event, change, or other circumstance that
could give rise to the termination of the Business Combination
agreement or could otherwise cause the transaction to fail to
close; (5) the failure to meet the minimum cash requirement of the
Business Combination agreement due to Horizon stockholder
redemptions and the failure to obtain replacement financing; (6)
the inability to complete a concurrent PIPE Investment in
connection with the Business Combination; (7) the failure to meet
projected development and production targets; (8) the inability to
obtain or maintain the listing of Flexjet’s shares of common stock
on The New York Stock Exchange following the proposed Business
Combination; (9) the risk that the proposed Business Combination
disrupts current plans and operations as a result of the
announcement and consummation of the proposed Business Combination;
(10) the ability to recognize the anticipated benefits of the
proposed Business Combination, which may be affected by, among
other things, competition, the ability of Horizon and Flexjet to
each grow and manage growth profitably, and retain its key
employees; (11) costs related to the proposed Business Combination;
(12) changes in applicable laws or regulations; (13) the
possibility that Horizon or the company may be adversely affected
by other economic, business, and/or competitive factors; (14) risks
relating to the uncertainty of the projected financial information
with respect to the Company; (15) risks related to the organic and
inorganic growth of the Company’s business and the timing of
expected business milestones; (16) the amount of redemption
requests made by Horizon’s stockholders; (17) actual or potential
conflicts of interest of Horizon’s stockholders and other related
parties as a result of certain relationships and transactions with
Flexjet and Horizon, including significant ownership interests and
business relationships; (18) members of management of Epic Aero,
Inc. and their affiliated entities and Eldridge and its affiliates
(including Sponsor) will control Flexjet following the consummation
of the Business Combination, and their interests may conflict with
Flexjet’s or its public stockholders, and such persons will be able
to determine the composition of Flexjet’s board of directors and
actions requiring stockholder approval, including a sale of Flexjet
(including in an unsolicited transaction, which they will be able
to block); (19) Credit Suisse Securities (USA) LLC, Deutsche Bank
Securities Inc. and RBC Capital Markets, LLC have in the past had,
and may in the future have, engagements with Eldridge and its
affiliated entities and (20) other risks and uncertainties
indicated from time to time in the final prospectus of Horizon for
its initial public offering dated March 15, 2021 filed with the SEC
and the Registration Statement on Form S-1, that includes a
preliminary proxy statement/prospectus, and when available, a
definitive proxy statement and final prospectus relating to the
proposed Business Combination, including those under “Risk Factors”
therein, and in Horizon’s other filings with the SEC. Horizon
cautions that the foregoing list of factors is not exclusive.
Horizon and Flexjet caution readers not to place undue reliance
upon any forward-looking statements, which speak only as of the
date made. Horizon and Flexjet do not undertake or accept any
obligation or undertaking to release publicly any updates or
revisions to any forward-looking statements to reflect any change
in their expectations or any change in events, conditions, or
circumstances on which any such statement is based, whether as a
result of new information, future events, or otherwise, except as
may be required by applicable law. None of Horizon and Flexjet
gives any assurance that any of Horizon or Flexjet will achieve its
expectations.
Participants in the Solicitation
Horizon and its directors, executive officers, other members of
management, and employees, under SEC rules, may be deemed to be
participants in the solicitation of proxies of Horizon’s
shareholders in connection with the Business Combination.
Information regarding the persons who may, under SEC rules, be
deemed participants in the solicitation of Horizon’s shareholders
in connection with the Business Combination will be in the
Registration Statement, including a proxy statement/prospectus,
when it is filed with the SEC. Investors and security holders may
obtain more detailed information regarding the names and interests
in the Business Combination of Horizon’s directors and officers in
Horizon’s filings with the SEC and such information will also be in
the Registration Statement to be filed with the SEC, which will
include the proxy statement/prospectus of Horizon for the Business
Combination. These documents can be obtained free of charge at the
SEC’s website (www.sec.gov).
Flexjet and its directors and executive officers may also be
deemed to be participants in the solicitation of proxies from the
shareholders of Horizon in connection with the Business
Combination. A list of the names of such directors and executive
officers and information regarding their interests in the proposed
Business Combination will be included in the proxy
statement/prospectus of the Business Combination when
available.
Projected Financial Information
This press release contains certain financial forecast
information of Flexjet. Such financial forecast information
constitutes forward-looking information, and is for illustrative
purposes only and should not be relied upon as necessarily being
indicative of future results. The assumptions and estimates
underlying such financial forecast information are inherently
uncertain and are subject to a wide variety of significant
business, economic, competitive and other risks and uncertainties.
See “Forward-Looking Statements” above. Actual results may differ
materially from the results contemplated by the financial forecast
information contained in this press release and the inclusion of
such information in this press release should not be regarded as a
representation by any person that the results reflected in such
forecasts will be achieved. Neither the independent auditors of
Horizon nor the independent registered public accounting firm of
the Company has audited, reviewed, compiled or performed any
procedures with respect to the projections for their inclusion in
this press release, and accordingly, neither of them expressed an
opinion or provided any other form assurance with respect thereto
for the purpose of this press release.
* About Non-GAAP Financial Measures
Adjusted Management EBITDA has not been prepared in accordance
with United States generally accepted accounting principles
(“GAAP”). This non-GAAP measure is an addition to, and not a
substitute for or superior to, measures of financial performance
prepared in accordance with GAAP and should not be considered as an
alternative to revenue, operating income, profit before tax, net
income or any other performance measures derived in accordance with
GAAP. A reconciliation of this projected non-GAAP financial measure
has not been provided and is unable to be provided without
unreasonable effort because certain items excluded from this
non-GAAP financial measure such as charges related to stock-based
compensation expenses and related tax effects, including
non-recurring income tax adjustments, cannot be reasonably
calculated or predicted at this time.
The Company and Horizon believe this non-GAAP measure of
financial results, including on a forward-looking basis, provide
useful information to management and investors regarding certain
financial and business trends relating to Company’s financial
condition and results of operations. The Company’s management uses
this non-GAAP measure for trend analyses and for budgeting and
planning purposes. The Company and Horizon believe that the use of
this non-GAAP financial measure provides an additional tool for
investors to use in evaluating projected operating results and
trends in and in comparing Company’s financial measures with other
similar companies, many of which present similar non-GAAP financial
measures to investors. Management of the Company does not consider
this non-GAAP measure in isolation or as an alternative to
financial measures determined in accordance with GAAP.
However, there are a number of limitations related to the use of
these non-GAAP measures and their nearest GAAP equivalents. For
example, other companies may calculate non-GAAP measures
differently, or may use other measures to calculate their financial
performance, and therefore the Company’s non-GAAP measures may not
be directly comparable to similarly titled measures of other
companies.
The Company defines Adjusted Management EBITDA as EBITDA (net
income (loss) before (a) interest expense (income), (b) income tax
expense (benefit) and (c) depreciation and amortization), as
further adjusted to exclude (1) loss / gain on aircraft sale, (2)
management fees, (3) other expense / (income), (4) fractional share
margin adjustment per credit agreement, (5) sale leaseback
adjustment per credit agreement, (6) Sentient jet pricing policy
adjustment and (7) customer concessions adjustment. Management does
not consider these items to be indicative of the Company’s core
operating results.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20221011005751/en/
Flexjet Investor Relations IRComms@Flexjet.com Flexjet Public
Relations Nicholas Parmelee The Hubbell Group, Inc. 216.406.5602
nparmelee@hubbellgroup.com Horizon Acquisition Corporation II Nadia
Damouni Prosek Partners 646.818.9217 ndamouni@prosek.com
Horizon Acquisition Corp... (NYSE:HZON)
Historical Stock Chart
From Oct 2024 to Nov 2024
Horizon Acquisition Corp... (NYSE:HZON)
Historical Stock Chart
From Nov 2023 to Nov 2024
