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The UK’s Cobham plc has launched a strategic review of its subsidiary Cobham Aviation Services Australia – Airline Services (NJS, Adelaide). The review will take place to decide how best to optimise value in the interests of the company and its shareholders, Cobham plc CEO David Lockwood said in a press release.
The Australian scheduled and charter carrier, which recently added its first Dash 8-400 to its fleet, operates over 50 aircraft for clients including Qantas, the Australian Border Force, the Australian Maritime Safety Authority, and Chevron. Its contract services include aerial border surveillance and search-and-rescue operations, and closed charter passenger and cargo services to remote sites for mining, oil and gas projects.
Delivering the UK company’s interim results, which included “organic revenue growth” at the Adelaide-based subsidiary of 10% in the first half of 2019, Lockwood also revealed that US private equity firm Advent International Corporation intended to make an all-cash offer to acquire Cobham plc, adding that Advent “is aware and supportive” of the strategic review at Cobham Aviation Services Australia.
Cobham plc itself is a British defence and aerospace group known in particular for its air-to-air refuelling technology and also includes the fixed-wing surveillance and search-and-rescue subsidiary Cobham Special Mission (Bournemouth). The Advent deal would be for USD5 billion.
However, Cobham’s largest shareholder, Silchester International Investors LLP, which owns about 12%, subsequently told Bloomberg that it opposed the deal on the grounds that Cobham could fetch a higher price after patching up its balance sheet that would pay off over the coming years. Silchester said it would reach out to other shareholders to discuss the agreement.