SATS Ltd. (SATS) announced that its shareholders voted to approve the proposed acquisition of Worldwide Flight Services (WFS) at an Extraordinary General Meeting (EGM), which was held in person and via electronic means on January 18.
The Singapore-based ground handling and catering provider said 96.80% of the total number of votes were in favour of the resolution to approve the transaction.
Voting at the EGM was conducted by poll.
"We are delighted and humbled to have received this affirmative vote of confidence from our shareholders. It is a clear demonstration that our shareholders recognise the strategic value and growth opportunities that this transformational deal will unlock for SATS and all of our stakeholders," said Kerry Mok, president and chief executive officer of SATS.
"We will be better positioned to provide our global customer base with end-to-end solutions while securing a pathway to profitable growth and uplifting our home-market base in Singapore," he added.
Acquisition awaits regulatory approval
SATS said with the receipt of shareholder approvals, the proposed acquisition of WFS now remains subject to requisite regulatory approvals.
It added that the transaction completion is currently envisaged to close in March/April 2023.
As part of its funding plan announced in December 2022 and as also stated in the Circular to Shareholders on January 3, SATS shall finance the transaction partly by way of a Proposed Rights Issue to raise up to approximately S$800 million (US$605 million).
In proceeding with the Proposed Rights Issue, the terms and timing of the Proposed Rights Issue will be determined by SATS in agreement with its underwriters and published at the appropriate time.
SATS earlier announced that the total acquisition cost would be S$1.8 billion (US$1.33 billion), and the proposed rights issue will not exceed S$800 million, with the balance amount to be funded primarily through a combination of term loans and internal cash resources.
SATS first announced the acquisition plan in September 2022 in a deal that
a deal that would create the world's largest air cargo handler.
Through the planned deal, WFS will become a wholly owned subsidiary of SATS after the proposed acquisition and will continue to be led by chief executive officer Craig Smyth.
Kerry Mok of SATS said then that the proposed acquisition of WFS is a "transformational opportunity" for SATS.
"Our customers are telling us that they want seamless support across regions in a way that simplifies and strengthens their own operations. Combining with WFS will let us meet those needs," Mok said in September. "It is a hugely powerful combination for growth, as well as delivering greater business resilience."
SATS said the acquisition would enable SATS to better serve air cargo customers in strategic hubs in Asia, Europe and the US, as well as in complementary new growth markets, including Latin America and Africa.
The combined network covers trade routes responsible for more than 50% of global air cargo volume.
WFS operates in five of the top 10 cargo airports in North America and EMEA, including Los Angeles, Chicago, Miami, Frankfurt and Paris. Meanwhile, SATS is already present in four of the top 10 cargo airports in Asia, including Hong Kong, Taipei, Singapore and Beijing.