A consortium of investors has agreed a €800 million (CHF860 million) bailout of Chinese-owned airport services company Swissport. Revenues at the company have nosedived since the onset of the coronavirus pandemic.This content was published on August 31, 2020 - 15:20
The consortium of US and British private equity firms and banks will buy out the majority stake currently held by Chinese conglomerate HNA. The bailout will comprise a €300 million short-term cash injection to meet immediate financing needs followed by a €500 million package.
The deal will wipe €1.9 billion of debt from the company’s books. With air travel coming to a virtual standstill, Swissport saw sales fall by 70% between March and the end of June. The company, which handles cargo and offers passenger ground support services at airports, recorded a €67 million operating loss in the same period.
“Swissport is one of the first companies globally to agree to a restructuring following the outbreak of the Covid-19 pandemic. We expect to see increased outsourcing of ground handling services by airlines and being able to take volumes from some financially weaker competitors,” said Swissport Chief Financial Officer Peter Waller in a statement on Monday.
HNA bought Swissport for CHF2.7 billion in 2015, but the Chinese group has been forced to get out of some investments since before the pandemic struck, including Zurich headquartered airline caterer Gategroup. HNA is also thought to be looking for a buyer for its Zurich-based aircraft maintenance company SR Technics.
The pandemic has forced Swissport, which is active at 300 airports in 47 countries, to shed 17,000 of its 64,000 global staff.
The deal to buyout HNA is expected to be completed by the end of the year.