Hampshire's Gama Aviation acquires air ambulance operator Specialist Aviation Services

Gama Aviation, based at Farnborough airport, reported it had acquired air ambulance operator Specialist Aviation Services (SAS) for £280,000 as part of a pre-pack acquisition from the latter's appointed administrators FRP.

In December last year, it was determined that SAS, which is based at Gloucestershire Airport and has been through operational and financial restructuring exercises since 2021, would to seek an accelerated acquisition process via pre-pack administration.

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Gama Aviation said the purchase added further "scale and strength” to Gama's Special Mission strategic business unit (SBU) with around £27 million of annual revenue, three significant UK air ambulance charity contracts, six managed Leonardo AW169 aircraft and two further national security contracts in the Middle East.

"This acquisition accelerates our growth in our Special Mission SBU, adding scale in the UK, building on our recent contract wins with amongst other the Welsh Air Ambulance and opening new international operations in the Middle East to complement our established fixed wing aircraft management and MRO capability in the region," noted CEO of Gama Aviation Marwan Khalek.

"We believe that there is considerable potential within the trade and assets of this business, that over the medium term will enhance the prospects of the Special Mission SBU.

"However, given the nature of the acquisition, our immediate priority is to ensure continuity of service for the UK air ambulance charities such that they are able to maintain their life-saving operations."

Considering the initial working capital requirements of the business at completion, provisions for restructuring costs and transaction costs, Gama said it expected the total cost of the acquisition to amount to around £3 million, to be funded from the its existing financial resources.

In the following weeks, it will carry out a detailed review of the book value of the net assets assumed as part of the deal, including appropriate provisions, it said.

The group will also assume lease obligations on helicopters and property with customer contracts amounting to around £8.7 million.

While Specialist has been loss-making historically, because of agreed changes to customer contracts and certain identified cost savings in combination with the group, the business of Specialist under the company is expected to deliver underlying additional revenues of around £27m per annum and be breakeven at the profit before tax level in the first half of 2024, it added.

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