Mercury Air (AMEX:MAX)
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Mercury Air Group Sells Its FBO Business - the Nation's Third
Largest Wholly-Owned FBO Chain - to Allied Capital Corporation for $76.3
Million
Proceeds From Sale to Be Used to Retire Debt & Provide Additional Working
Capital
LOS ANGELES, April 12 /PRNewswire-FirstCall/ -- Mercury Air Group announced
today that its shareholders have overwhelmingly approved the sale to Allied
Capital Corporation of the nation's third largest wholly-owned fixed base
operations (FBOs), operating under the name Mercury Air Centers. Total
consideration received by Mercury for this transaction is $76,300,000, subject
to adjustment based on Mercury Air Centers, Inc.'s net working capital at the
time of closing.
The proceeds from the sale will be used to prepay outstanding long term debt and
associated accrued interest of $41,300,000; post cash collateral in the amount
of $16,000,000 in support of currently outstanding letters of credit; establish
an escrow account of $8,300,000 to be distributed to Mercury, under certain
terms and conditions associated with the FBO lease at the Hartsfield
International Airport in Atlanta; and pay approximately $1,700,000 in
transaction costs resulting in surplus cash at the close of the sale of
approximately $9,000,000.
"Mercury Air Group opened its first FBO in Burbank, California in 1982 and grew
it into one of the nation's largest and unsurpassed FBO chains in the nation,"
said Joseph A. Czyzyk, President & CEO of Mercury Air Group, Inc. "Now, the
transaction marks a new turning point for Mercury Air Group. For the first time
in 50 years, Mercury Air Group will not be burdened with significant debt.
After a required transition period, we will begin to focus on the growth of our
remaining businesses."
Mercury Air Centers are located in: Alabama (Birmingham); California
(Bakersfield, Burbank, Fresno, Los Angeles, Ontario and Santa Barbara); Georgia
(Atlanta Hartsfield and Dekalb Peachtree); Indiana (Fort Wayne); Mississippi
(Jackson); Nevada (Reno/Tahoe); Oklahoma (Tulsa); South Carolina (Charleston and
John's Island); Tennessee (Nashville); Texas (Dallas/Addison and Corpus
Christi); and Virginia (Newport News).
About Mercury Air Group, Inc.
Los Angeles-based Mercury Air Group (AMEX:MAX)(PCX:MAX) provides aviation
petroleum products, air cargo services and transportation, and support services
for international and domestic commercial airlines, general and government
aircraft and specialized contract services for the United States government.
Mercury Air Group operates three business segments worldwide: MercFuel Inc.,
Maytag Aircraft Corporation and Mercury Air Cargo, Inc. For more information,
please visit http://www.mercuryairgroup.com/.
About Allied Capital
Allied Capital is the nation's largest business development company and provides
long-term debt and equity investment capital to support the expansion of
companies in a variety of industries. The company also participates in the real
estate capital markets as an investor in non-investment grade commercial
mortgage-backed securities and collateralized debt obligation bonds and
preferred shares. The company is headquartered in Washington, DC. For more
information, please visit the web site at http://www.alliedcapital.com/.
Statements contained in this news release which are not historical facts are
forward looking statements as that item is defined in the Private Securities
Litigation Reform Act of 1995. Such forward-looking statements are subject to
risks and uncertainties that could cause actual results to differ materially
from estimated results. Such risks and uncertainties are detailed in The
Company's filings with the Securities and Exchange Commission.
For further information, please contact Larry Barrios of TheMWW Group,
+1-213-486-6560, , for Mercury Air Group, Inc.
DATASOURCE: Mercury Air Group, Inc.
CONTACT: Larry Barrios of The MWW Group, +1-213-486-6560,
, for Mercury Air Group, Inc.
Web site: http://www.alliedcapital.com/
Web site: http://www.mercuryairgroup.com/