Atlas Air To Purchase Polar Air Cargo For 84 Million
Atlas Air To Purchase
Polar Air Cargo For 84 Million
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Purchase, NY (July 12,
2001) -- Atlas Air announced today that it has entered into an agreement
with an affiliate of GE Capital Aviation Services, Inc. (GECAS), a wholly
owned subsidiary of the General Electric Company (NYSE:GE), to acquire
Polar Air Cargo for a stated purchase price of $84 million. Agreements
to monetize assets and arrangements to place surplus aircraft, restructure
leases and financing commitments of GECAS are expected to reduce the effective
net cost of the acquisition by $25 million to $30 million. Atlas Air Worldwide
Holdings, Inc.
will acquire Polar Air Cargo free
of any debt, with restructured aircraft operating leases, and will operate
it with a resized fleet. The resized fleet of primarily B747-400 aircraft
is expected to be fully utilized in scheduled service. Polar Air Cargo specializes in time-definite,
cost-effective airport-to-airport scheduled airfreight service. Its fleet
is comprised exclusively of Boeing 747 freighter aircraft. The company's
scheduled route network serves all of the world's major economic regions,
with significant international route authorities in key markets around
the world that have been acquired over the last eight years.
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Atlas Air Worldwide Holdings, Inc. is
the parent company of Atlas Air, Inc., a United States certificated air
carrier that operates a fleet of B747 freighters under ACMI contracts.
These contracts include the provision of Aircraft, Crew, Maintenance and
Insurance for some of the world's leading international carriers. Polar
and Atlas Air will be operated as separate subsidiaries of the parent company.
Polar will maintain its operations from its Long Beach, CA headquarters
for the immediate future.
Completion of the acquisition is
subject to receipt of certain regulatory approvals and other customary
closing conditions. "In meeting the current challenging
economic environment, we have initially focused on sizing our existing
operations appropriately to ensure that we emerge an even stronger and
more efficient company when demand begins to improve. We are now turning
our attention to strengthening our position in the industry through strategic
opportunities," said Richard Shuyler, Chief Executive Officer for both
Atlas Air Worldwide Holdings, Inc. and Atlas Air, Inc. "With its valuable
route authorities and its similar fleet of B747 freighter aircraft, Polar
offers a strong fit - and a significant opportunity. Combined with Atlas
Air Worldwide Holding's financial discipline and industry expertise, this
acquisition will allow both companies to offer complementary services to
their separate customer bases.
"While we plan to keep the Atlas
Air and Polar brands separate, we expect to achieve significant synergies
between the two companies. More importantly, however, this transaction
will give us access to the Japanese market - a market we have sought to
enter since Atlas Air's inception - and beyond to other points in Asia.
Tokyo is the world's fourth largest freight market, and operating rights
there are greatly sought after and highly restricted. Gaining Polar's substantial
rights there is of tremendous value to us. We expect that our shareholders
will see revenue and earnings per share benefits from this acquisition
as early as next year," Shuyler added. "We welcome Polar Air Cargo to the
Atlas Air Worldwide Holding family. We see tremendous opportunities to
continue to grow our business, synergistically pursue new market opportunities
and further expand strategic partnerships as we continue to build a world-class
company of which we all can be proud," Shuyler concluded.
