Air Transport Services to be acquired by Stonepeak for $3.1B in cash

Air Transport Services (ATSG) announced that it has entered into a definitive agreement to be acquired by Stonepeak in an all-cash transaction with an enterprise valuation of approximately $3.1B. 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 November 1, the last full trading day prior to this announcement, and a 45.5% premium over ATSG’s volume-weighted average price 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 transaction is expected to close in the first half of 2025, 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 December 8 and in certain cases for a period of 50 days continuing through December 23. 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 determines such disclosure is appropriate or otherwise required.