July 1 (Reuters) – Canada’s Brookfield Asset Management Inc and Singaporean sovereign wealth fund GIC on Monday agreed to buy U.S. freight railroad owner Genesee & Wyoming Inc for about $6.4 billion in cash.
Brookfield and GIC’s offer of $112 per share represents a premium of 12 percent to Genesee’s closing price on Friday. Genesee shares were up about 8 percent in trading before the bell.
Including debt, the deal is valued at about 8.4 billion, the companies said in a statement.
Genesee & Wyoming’s revenue have increased at a compound annual growth rate of 16.8% since it floated in the stock market in 1996, rising to $2.3 billion in 2018 from $77.8 million, according to Genesee & Wyoming’s latest annual report.
The company owns a portfolio of 120 short-line railroads, predominantly in North America, with operations in Europe and Australia.
Reuters had reported on the deal on Sunday, citing sources.
The deal, which is expected to close by year end or early 2020, would be the latest big leveraged buyout by Brookfield, which agreed last year to buy Johnson Controls International Plc’s power solutions business for about $13 billion.
Citigroup Global Markets Inc served as the financial adviser to Brookfield and GIC, while BofA Merrill Lynch and Morgan Stanley & Co LLC advised Genesee.
(Reporting by Ankit Ajmera in Bengaluru; Editing by Anil D’Silva)
WELLINGTON
(Reuters) – Air New Zealand Ltd said on Monday it has ordered eight
Boeing Co 787-10 Dreamliner jets worth $2.7 billion (2.12 billion
pounds) at list prices, to be powered by General Electric Co engines, as
part of a drive toward increased efficiency.
New
Zealand’s flag carrier also trimmed its earnings outlook citing higher
fuel prices, and said problems with Rolls-Royce Holdings PLC engines and
a moderation in demand growth have impacted its financial and
operational performance.
The
new plane order confirmed a Reuters report last week that Boeing had
beaten out rival Airbus SE, which had proposed the A350 for the hotly
contested deal.
The
airline, which has Rolls-Royce engines on its existing fleet of 13
787s, announced it had switched to GE engines for the new order.
The
787s will replace eight older 777-200ERs and leave the carrier with an
all-Boeing wide-body fleet as well as Airbus A320 family jets for
shorter flights.
The order comprises eight long-range 787-10s, with the agreement including an option to increase the number of aircraft to 20.
The
deal also gives the airline, which has previously mentioned a goal of
flying Auckland-New York non-stop, the option to switch some aircraft to
the longer range 787-9s.
“With
the 787-10 offering almost 15 percent more space for customers and
cargo than the 787-9, this investment creates the platform for our
future strategic direction and opens up new opportunities to grow,” Air
New Zealand Chief Executive Christopher Luxon said in a statement.
The eight jets will enter the Air New Zealand fleet between 2022 and 2027, the airline said.
“The
787-10 has 95 percent commonality with Air New Zealand’s existing fleet
of 787-9s and will provide the airline with added benefits in terms of
capacity and overall operations,” Vice President of Boeing Commercial
Sales and Marketing for Asia Pacific Christy Reese said.
The
787-10 is the largest member of Boeing’s Dreamliner series, and can
serve up to 330 passengers in a standard two-class configuration, about
40 more than the 787-9 airplane.
The
airline said the 787 was 25 percent more fuel efficient than the jets
it is replacing, and noted that carriers typically receive large
discounts on the list price of jets.
HEADWIND
In
a separate announcement, Air New Zealand trimmed its 2019 earnings
before taxation, saying it now expects to beat NZ$340 million ($223
million). That compared with a forecast range of NZ$340 million to
NZ$400 million announced in late March.
The change was due to an additional NZ$25 million headwind from increased jet fuel prices, the company said.
The
airline also said Rolls-Royce engine issues – in which components
prematurely fail or needed extra checks – impacted 2,500 flights and led
to 150 cancellations, affecting its financial performance.
Air
New Zealand in March launched a two-year cost reduction programme and
said it would defer spending on aircraft by about NZ$750 million ($491
million) as part of a business review.
In
February, Air New Zealand slashed domestic fares by as much as 50
percent in a shake-up of its pricing structure in response to the
slackening travel market.
(Reporting by Praveen Menon in Wellington, Aditya Soni in Bengaluru and Jamie Freed in Singapore; Editing Richard Pullin and Christopher Cushing)
Low-cost Viva Air plans NYSE listing within two years
Budget carriers are disrupting transport across Latin America
Rendering of an Airbus A320neo Viva Air aircraft Source: Airbus SE
Viva Air, the Latin American group of carriers owned by a founder of Ireland’s Ryanair Holdings Plc, has plans for a third airline in the region plus an initial public offering, to cash in on strong demand for discount air travel.
The company aims to sell shares in New York within two years, Viva’s biggest shareholder, Declan Ryan, said in an interview in Lima. The shares could also be listed on another exchange, such as Colombia’s, he said.
(Reuters)
– Delta Air Lines fueled the appetite of planemakers on Tuesday after
Chief Executive Ed Bastian said the airline planned to replace some 200
Boeing 757 and 767 aircraft over the next decade.
The plans come as the second largest U.S. airline seeks to grow internationally, though Bastian said at a conference that the company had not yet decided whether to invest in struggling Italian carrier Alitalia.
Atlanta-based Delta’s potential fleet order, which analysts say would be worth over $10 billion, could boost proposals by Boeing Co to launch a new plane in that segment while Airbus is preparing to counter with a new version of A321 and the larger A330neo.
Delta
is “very interested” and in discussions with Boeing about its proposed
new midsized airplane, known as the NMA, Bastian said. Boeing will
decide in 2020 whether to produce the plane which industry sources say
would have two aisles and seat seven across.
The
plane aims to address the so-called middle of the jet market between
traditional narrowbody jets with one aisle and long-distance widebody
planes.
“Hopefully they’ll decide to go,” Bastian said.
Delta
is already in the process of replacing one-third of its mainline fleet,
one of the largest and oldest among U.S. airlines, in the next five
years.
Delta shares were up 2.5 percent at $50.03 in afternoon trading after Bastian said spring and summer travel demand was solid.
Delta Air Lines reveals their first A220 in Atlanta, Georgia at the TechOPS engine shop at Hartsfield Jackson International airport on Monday October 29,2018. (Chris Rank/Rank Studios)
ALITALIA INVESTMENT?
Bastian
said it was too early to decide whether to invest in Alitalia, which
was put under special administration in 2017 after workers rejected the
latest in a long line of rescue plans, leaving the Italian government
seeking a buyer to save the airline.
Italy’s
state-controlled railway Ferrovie dello Stato (FS) said last month it
would start negotiations with Delta and EasyJet Plc to draft a rescue
plan, the third in a decade, for the struggling airline.
Delta
executives have held talks in Rome in recent weeks, according to
Italian industry sources, but doubts remain whether an outside investor
would be willing to take a minority stake in the strike-prone airline.
Bastian
said that the numbers being thrown around for Alitalia are “pretty
large” and “not the kind of numbers that we’re considering, just to
quell any concerns.”
Still,
he said it makes sense to consider an investment in Italy, an important
market for U.S. consumers, and noted that Delta’s global growth over
time will skew toward international rather than congested domestic
markets.
That growth could come through direct investments in overseas carriers.
“You
can’t actually own partner carriers so you have to find ways to
influence them beyond just a commercial contract as a partner, and what
we have found is that by making an investment into these businesses we
can get actually inside the board room and help to start shape the
strategy.”
(Reporting by Tracy Rucinski in Chicago, additional reporting by Tim Hepher in Paris; Writing by Nick Zieminski; Editing by Phil Berlowitz and Lisa Shumaker)
NEW YORK (Reuters) – Ryanair Holdings Plc (RYA.I) and longtime Chief Executive Michael O’Leary have been sued in New York by a shareholder that said Europe’s largest airline defrauded investors and inflated its share price by overstating its ability to manage labour relations and keep costs down.
The complaint was filed on Tuesday night in the U.S. District Court in Manhattan by an Alabama pension fund, seeking class-action status and damages for investors in Ryanair’s American depositary shares from May 30, 2017 to Sept. 28, 2018.
Ryanair did not immediately respond on Wednesday to requests for comment.
The complaint said Ryanair misled investors in regulatory filings and conference calls about its labour stability, including “industry leading” contracts with pilots and cabin crews, and its positive impact on operations.
It said the truth came out as labour unrest forced the Dublin-based low-cost carrier last December to recognise unions for the first time, and led this summer to costly strikes that stranded thousands of passengers in several countries.
“Unbeknownst to investors, the company’s historical profit growth was built on an undisclosed and unsustainable foundation of worker exploitation and employee turnover,” the complaint said. “The decline in the price of Ryanair ADSs was the direct result of the nature and extent of defendants’ fraud finally being revealed to investors and the market.”
Ryanair cited labour issues on Oct. 1, when it cut its full-year profit forecast. Its share price closed that day more than one-third below its level in mid-March.
O’Leary, Ryanair’s chief executive since 1994, said last month he hoped to reach labour agreements with all of the carrier’s major unions before Christmas.
ADSs on June 30 accounted for 43.7 percent of Ryanair’s issued ordinary shares, assuming all were converted into ordinary shares, the company has said. Ryanair’s market value is roughly $16 billion, according to Refinitiv data.
The lawsuit was filed by the City of Birmingham Firemen’s and Policemen’s Supplemental Pension System. Its law firm Robbins Geller Rudman & Dowd specializes in securities fraud.
It is common for shareholders to sue companies in the United States after what they consider unexpected share price declines.
The case is City of Birmingham Firemen’s and Policemen’s Supplemental Pension System v Ryanair Holdings Plc, U.S. District Court, Southern District of New York, No. 18-10330.
(Reporting by Jonathan Stempel in New York; editing by Bill Berkrot)
World’s largest leisure travel company and China State Shipbuilding Corporation set to formally launch cruise joint venture this week under the name CSSC Carnival Cruise Shipping Limited.
New cruise company in China to purchase two existing ships from Costa Group, with the first ship expected by end of 2019 to begin serving guests as part of the JV fleet.
Joint venture also finalizes previously announced agreement for world’s first two new cruise ships to be built in China for the Chinese cruise market, the first of which will be delivered in 2023.
