ASL Aviation Group (ASL) signed (16-Nov-2012) an agreement to acquire TNT Airways and Pan Air Líneas Aéreas from TNT Express. ASL said the integration of the airlines will "strengthen the company’s capabilities and ensure that it continues to provide customers with first class and reliable professional service. This transaction represents a unique opportunity for ASL to be in a position to provide services to the major integrators and assert itself as the neutral provider of airline services to the major express integrators in Europe." ASL also owns Air Contractors, Europe Airpost and Safair. The transfer is conditional on, and will become effective immediately prior to, completion of the proposed merger between UPS and TNT Express. The change of ownership and control will ensure continuity of TNT Express operations after the merger, in compliance with EU airline ownership and control rules. TNT Express interim CEO Bernard Bot said, "We have found a new ownership and control structure that secures the future of the airlines, ensures service continuity and safeguards jobs in Liège. This is an important step towards completion of the proposed UPS-TNT Express merger and a positive outcome for the airline employees." [more - original PR - ASL Aviation Group] [more - original PR - TNT Express]
ASL Aviation Group to acquire TNT Airways and Pan Air Líneas Aéreas
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IAG's Capital Markets Day on 4-Nov-2016 was the first since its formation in 2011 when it lowered any of its medium term financial targets. It cut its 2016-2020 average EBITDAR goal, in spite of adding in Aer Lingus for the first time. This followed two cuts to 2016 operating profit guidance during the course of this year, as a result of "a tough operating environment". It has been hit by adverse currency movements, mainly resulting from the UK's Brexit vote, in addition to ATC strikes and terrorist events.
To its credit, IAG has responded to the more challenging trading conditions by lowering its planned capacity growth and capital expenditure during its 2016-2020 strategic plan. These steps are necessary if it is to have a chance of meeting its ambitious goal to sustain a 15% return on invested capital. This target is unchanged, despite the lower profit outlook.
In 3Q2016, IAG's rolling four quarter return on capital fell, after rising more or less continuously since it began to target this measure in 2013. It has consistently been more profitable than either of its two main European legacy airline group rivals (Air France-KLM and Lufthansa). Nevertheless, the downward step highlights the challenge in meeting its own demanding target.
IAG Group: Vueling is stalling, but Aer Lingus helps to grow 2Q profits. 2016 outlook lowered
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Three of IAG's four operating airlines improved their margin in 1H2016 but Vueling's declined, since the external disruption affected it the most. Vueling's operating margin has been on a downward trend since its acquisition by IAG in 2013. Its capacity growth plans for FY2016 have now been trimmed, also scaling back the group's growth for the year.
IAG now expects 2016 operating profit growth of a low single-digit percentage, much less than the 40% increase previously anticipated but still an increase. This outlook is more positive than that given recently by Lufthansa, which expects a fall in profit this year. Moreover, IAG remains a higher margin group than either of Lufthansa or Air France-KLM, and should be better placed if there is to be a full-scale downturn.