TIDMBBA
RNS Number : 8985R
BBA Aviation PLC
01 November 2019
1 November 2019
Ontic disposal completion and proposed return of capital
BBA Aviation ("BBA" or "the Group"), a market-leading provider
of global aviation support services, is pleased to announce it has
completed the disposal of Ontic to CVC Fund Vll having met all
regulatory and financial conditions.
The previously announced disposal price of $1,365 million is
subject to certain price adjustments including cash and debt-like
items at closing, resulting in effective proceeds of $1,321
million. Out of these proceeds, BBA intends to repay $250 million
of bank debt, has paid $32 million of USPP make-whole costs, and
has agreed to contribute $39 million (being the $ equivalent of
GBP30 million) to the BBA Income and Protection Plan, in
consideration of the Pension Scheme Trustee releasing the security
which it held over certain of Ontic's assets. There will also be
further payments with regard to tax and customary transaction
fees.
Taking account of these deployments, BBA is planning to return
$835 million to shareholders, an amount which is near to the top
end of the guided range when the transaction was announced on 30
July 2019. The reduction in net debt is intended to ensure a strong
balance sheet is maintained and to position the Group near the
lower end of the stated targeted range of net debt to underlying
adjusted EBITDA of 2.5 to 3.0 times on a covenant basis at 31
December 2019.
The Board has approved a return to shareholders of 80.71 cents
per existing ordinary share as a special dividend, equivalent to
approximately 21% of the ordinary share price at close of business
on 31 October 2019. The special dividend will be paid on 13
December 2019 to shareholders who are on the register at the close
of business on 22 November 2019. In order to maintain the
comparability of the Group's share price and per-share metrics
before and after the special dividend, the Group plans to undertake
a share consolidation. The share consolidation will replace every 5
existing ordinary shares with 4 new ordinary shares.
Following completion of the Ontic disposal and given the
on-going process to dispose of the ERO business, it is expected
that the Group will from that point comprise predominantly the
market-leading Signature business. This will enable enhanced focus
on Signature, which the Board believes to be a significant source
of future shareholder value creation. The Board has therefore
elected to change the Company's name to "Signature Aviation plc"
which will better align it with the Company's most significant
brand in its core market. In addition, it will create a stronger
and clearer connection of the brand to shareholders and other
stakeholders.
It is intended that the change of name will come into effect on
or around 25 November 2019. The intended effective date of the
change of name has been chosen to align as closely as possible with
the start of trading of the new ordinary shares, post the share
consolidation.
The Company's ticker will change to "SIG" and the Company's
current ISIN and SEDOL will change due to the share consolidation
and the issuance of the new ordinary shares. The Company's shares
will remain listed on the London Stock Exchange and the Company
will remain a member of the FTSE 250. The Company's website will
change to www.signatureaviation.com. All of these changes will be
effective as soon as practically possible after the change of name
has been implemented.
Signature's free cash generative characteristics should allow it
to sustain a progressive dividend policy and the potential for
ongoing returns of capital, surplus to the investment requirements
of the Signature business, while maintaining a strong balance sheet
within the target leverage range on a covenant basis. The
progressive dividend policy is based on a dividend per share basis
and the directors intend to continue following this policy once the
proposed share consolidation has been completed, with the dividend
per share for the new ordinary shares being progressive relative to
the dividend per share for the existing ordinary shares. The Board
expects the next payment under this policy to be the final dividend
in respect of the 2019 financial year. The policy applies to the
annual ordinary dividend and excludes the special dividend of 80.71
cents per share.
The share consolidation is subject to the approval of the
Company's shareholders and accordingly the Company has today posted
to shareholders a Notice of General Meeting and explanatory
circular (the "Circular") to shareholders regarding the share
consolidation and related resolutions which will be put to
shareholders at the General Meeting.
The General Meeting will be held at 9.00am on Friday 22 November
2019 at the Company's registered office, 105 Wigmore Street, London
W1U 1QY.
The Circular and the Notice of General Meeting have been
submitted to the National Storage Mechanism located at
www.morningstar.co.uk/uk/nsm.
The Circular and the Notice of General Meeting can also be
viewed at or downloaded from the Company's website at
www.bbaaviation.com/investors.
Shareholders will receive the Special Dividend in pounds
sterling unless they complete and submit to the Company's
registrars an election form stating their wish to receive their
dividends in US dollars. The pounds sterling dividend payment will
be converted from US dollars at a prevailing exchange rate during
the period commencing 23 November 2019 and ending 1 December 2019.
Shareholders will be notified of the exchange rate determined
through an RNS announcement on 2 December 2019. Existing currency
elections for final and interim dividends paid by the Company apply
to the Special Dividend.
The Company has taken the decision that its Dividend
Reinvestment Plan will not apply to payment of the Special
Dividend, in accordance with the terms and conditions of the
Dividend Reinvestment Plan.
Timetable
Publication of circular and reference price 1 November 2019
for share consolidation
General Meeting 22 November 2019
Record date for entitlement to the special 22 November 2019
dividend
Ex-dividend date for the special dividend 25 November 2019
Special dividend payment date 13 December 2019
Notes:
The Group will publish a trading update for the year to 31
October 2019 on 13 November 2019.
Enquiries:
BBA Aviation plc
David Crook, Group Finance Director
Kate Moy, Head of Investor Relations and Communications
(020) 7514 3999
Tulchan Communications
David Allchurch
(020) 7353 4200
Information on BBA Aviation plc
BBA Aviation plc is a market leading, global aviation support
and aftermarket services provider, primarily focused on servicing
the Business and General Aviation (B&GA) market. We support our
customers through our principal business Signature and Global
Engine Services/Engine Repair and Overhaul (ERO).
Signature, including Signature FBO, TECHNICAir(TM) and EPIC
Fuels, provides premium, full-service flight and home base support
including refuelling, ground handling and MRO services through the
world's largest fixed base operation (FBO) network for B&GA
users with around 200 locations covering key destinations in North
America, Europe, South America, Caribbean, Africa and Asia. EPIC
Fuels is a provider of aviation fuels, supplies and services
operating at more than 200 locations.
On 1 March 2018 BBA Aviation announced that it was conducting a
strategic review of the ERO business and, at the end of May 2018,
management committed to a plan to sell substantially all of the
business and the relevant assets and liabilities were classified as
held for sale. The sale process is ongoing.
For more information, please visit www.bbaaviation.com
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
DISUARURKSAROUA
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