Babcock to sell part of aerial emergency services business
Babcock International Group is to sell parts of its aerial emergency services business for €136.2m ($138.2m) to funds managed by infrastructure investor Ancala Partners.
The businesses concerned operate a fleet of 232 aircraft across 164 operational locations in six countries. They provide aerial emergency medical services, firefighting and search & rescue (SAR) for customers and communities in Italy, Spain, Portugal, Norway, Sweden and Finland employing more than 2,400 staff.
Babcock plans to retain its aerial emergency services businesses in its focus countries of UK, France, Canada and Australia, where the firm also operates defence businesses. The sale will help the company reduce complexity and the proceeds will be retained for general corporate purposes.
David Lockwood, CEO, Babcock said: “The agreement marks another significant step forward in our strategy to align our portfolio. I would like to thank colleagues for their commitment and hard work in providing vital services for their customers, not least through the pandemic, and I wish them and Ancala every success for the future.”
Ancala Partners said the acquisition is consistent with its focus on investing in critical infrastructure businesses with significant asset backing. The newly-acquired businesses operate aerial emergency services under long-term partnerships with public authorities. “We look forward to working with the business in continuing to deliver vital services to its customers,” said Ancala Partners.
Part of Babcock’s Aviation sector, the businesses being sold reported revenues of £407m and a loss before tax of £177m for the year ended March 31st 2021. The figures include a £6m contribution before allocated overheads, exceptional items and other one-off adjustments arising from the contract profitability and balance sheet.
Based on unaudited figures for the year ended 2022, the businesses have recorded revenue of £405m and a loss before tax of £10m on an operating profit contribution of about £13m before allocated overheads. Gross assets were £635m and net lease liabilities were £209m, as of March 31st 2022, according to unaudited figures.
Meanwhile, the current transaction is expected to complete by the end of this year, subject to regulatory and other conditions. (Pictured is an emergency services helicopter belonging to Babcock’s Italian fleet).