As predicted by TRBusiness earlier this year, gategroup is to acquire majority control of Servair from Air France for an enterprise value of €237.5m ($248.6m) on a 50% basis.

 

This transaction is expected to be completed on 1 January 2017, so delivering a combined presence for both companies in 50 countries with 200 facilities, 39,000 employees and 300-plus airline customers.

 

This follows Air France/Servair’s exclusive discussions with the HNA Group (which now owns gategroup) for the sale of its inflight catering unit Servair earlier this. At that time Air France had indicated that it would enter into a joint venture with HNA Group.

 

HNA’S GRAND PLAN COMPLETES ANOTHER MAJOR PHASE…

In turn, HNA also indicated that its initial interest in Servair would only remain if it succeeded in acquiring gategroup – which it obviously now has.

The bottom line is that this transaction will effectively give gategroup and its parent HNA – and all of the latter’s many airline interests – control over one of the world’s leading inflight catering companies. Servair also owns 50% of the Dutyfly Solutions inflight duty free concessionaire company (the other 50% is held by Lagardère Travel Retail).

 

Dutyfly solutions is based at Paris Charles de Gaulle Airport and works in seven countries and at nine airports with the following airlines: Air France, Air Tahiti Nui, XL airways, air burkina, Alitalia, Blue air, Blue Panorama, CSA Czech Airlines, ECAir, Iberia, Jetairfly, Luxair and transavia.com. It claims to send out 1,500 inflight trolleys a day, train 25,000 cabin crew a year and reach 100,000 passengers every day.

 

Meanwhile, in terms of the detail, the bigger core Servair transaction will be solely financed by gategroup, initially through a bridge facility, which will be replaced by a capital market transaction envisaged in the first half of 2017.

 

VERTICALLY INTEGRATED AIRLINE COMPANY…

The company said: “The addition of Servair to gategroup will create an unprecedented offering in the inflight catering business serving more than 300 airline customers in more than 200 facilities with 39,000 employees.

 

Servair will complement gategroup’s global network with a strong presence in France and Africa. Annual group revenue following the acquisition is projected to exceed CHF4.4bn ($4.2bn).

 

“The acquisition supports gategroup’s Gateway 2020 strategy by allowing it to serve global clients in an unmatched number of locations, to strengthen its culinary excellence and retail on board offering and to expand into fast-growing markets in Africa and Asia.”

 

Adding his comments, Xavier Rossinyol, the CEO of gategroup said: “We warmly welcome Servair and its employees into a partnership that will be highly beneficial for both sides.

 

CONSOLIDATION CONTINUES AT PACE

“The new group will aim to take advantage of the best competences of both gategroup and Servair and at the same time to have the most global network worldwide to better serve our customer.

 

“We will operate as one group with global leadership. With this new step we will be able to further accelerate the strategy of efficiencies and growth.”

 

It should also not be forgotten that that the HNA Group also owns Haikou Meilan Airport on Hainan Island. Founded in 1993, it generated total revenues of nearly CNY190bn ($28bn) in 2015 and this year was ranked 353 in the Fortune 500, with annual revenue of approximately $29.5bn (CNY199.5bn).

 

A VERY POWERFUL AND INFLUENTIAL GROUP….

HNA is one of China’s leading airline group owners with Hainan Airlines and many other carriers within its 1,250-strong civil aircraft total, serving 1,000 domestic and international routes in and out of China. In addition, it has 13 airports under its management, which include both Hakou Meilan and Sanya Phoenix on Hainan Island.

 

As noted by TRBusiness before and also in this story, the HNA Group recently acquired gategroup, which operates duty free and catering concessions on aircraft, having already purchased Gate Gourmet and the company is certainly one to watch in terms of its future involvement on Hainan Island and way beyond.

 

The ‘friendly’ gategroup public sale to HNA was led by its CEO Xavier Rossignol who joined the company in April 2015 after 12 years with the Dufry Group, beginning as Group CFO and ending his long stint as COO EMEA and Asia.