Hangar 8 Share Discussion Threads

[turnerpa51] 04/3/2014 09:02

It would be nice to get an update from the management team!

[lbo] 28/2/2014 13:53

Henryatkin the best comparison is Air partner plc (AIP) not any of your pure Airline comparisons!!!

[michaelwhight] 27/2/2014 07:19

Any timelines on this suspension? I presume they are doing DD

[2baffled] 26/2/2014 21:52

Re. Post 287.
Yes.
No meaningful assessment can be made pre. the release of the RTO AIM Admission Doc..

[goliard] 26/2/2014 20:29

Henry. Unfortunately many of those companies are airlines, so totally different businesses as HGR8 is not an airline and doesn't own or operate a single plane. AIP is closer to the mark, but better comparators may be other companies who manage hard assets (not that I can think of any right now!). Looking forward to the prospectus!

[oblivion0280] 26/2/2014 19:22

Sure some of you would have seen this but it's Robbie Burns input on our share'Interesting announcement from Hangar 8 which looks like it is going to be reversed into by a bigger company.It's good news and shareholders await developments and in the meantime the shares are suspended. One suspects they will return higher!In the same sector Avation produced a report which augurs well for the future, and that remains a long-term position'RegardsLee

[rivaldo] 26/2/2014 12:02

Having just returned from hols I'm on a catch-up, so thx especially to Adam and henryatkin et al for some invaluable posts.

I would note that (1) the available accounts for ACS are out of date now, so it's perhaps a little premature to make assumptions about "good" or "bad" deals until more up to date trading figures for ACS are shown in the next RNS we get.

And (2), the margins for ACS - on the available figures anyway - are so much lower than for HGR8 that we can be sure Dryden will have a plan for overhauling the business post-reverse in the same way he's achieved with HGR8. Which is presumably the opportunity he sees. I'd guess that once ACS becomes part of a listed entity there will be plenty of froth which can be stripped out.

[adamb1978] 25/2/2014 13:02

Good work Henry but depends on how the dynamnics work. If ACS approached us and are expecting to run the combined entity post-deal, which I would expect given that they are larger, then we should get the premium not them

[henryatkin] 25/2/2014 11:39

I've done my own relative valuations. Its difficult with ACS being non listed but we can still use Price Sales Ratio and compare our sector average. The companies I've found to compare are HGR8, EZJ, RYA, FLYB, AERL, AVAP, & AIP. That leaves PSR as HGR8(1.01), EZJ(1.65), RYA(1.9), FLYB(0.2) AVAP(2.4), AERL(0.5), AIP(0.3). That gives a sector average of PSR 1.14
ACS give sales as £252m so on a PSR 1.14 valuing them at £287m. Given the large divergence between the highest and lowest PSR I turned to JP Morgan's compustat long tern stats give an average PSR of around 1.4 over 40 years data for all companies so on that measure they are worth £353m. Given a takeover premium of say 20% to 30% I think anything under £450m is reasonable value and below £300m is good value and over £500m I would consider a bad deal.
edit. I have taken my figures from Sharelockholmes. The prices given are for ACS not the combined HGR8 + ACS.

[goliard] 25/2/2014 08:03

Adam, although I agree that it will be a reverse t/o I'm not so sure about 'one company is 10x the size of the other'. You would normally say that in relation to market cap, but in this case it is only turnover. HGR8's profit isn't far off ACS's (although I accept that might not be as clear as they could be). I would be very disappointed if it was proposed that ACS shareholders ended up with 10x what we do in the new co unless they can show that their profit is, in reality, 10x ours.

It will be really interesting to see the relative valuations and the justification for them.

[adamb1978] 25/2/2014 07:55

turnerpa51 - its not a merger at all. One company is 10x the size of the other - its [effectively] an acquisition of HGR8 though structured the other way around in order to retain the listing

[goliard] 24/2/2014 21:42

It may be a good move for both companies, but the question should be 'is it a good move for the reprective shareholders?' The answer to the two questions is not necessarily the same and depends on the respective valuations, potential cost savings and possibilities for growth.

I want to see the offer document before deciding.

[turnerpa51] 24/2/2014 19:17

I think it's a good move for both companies.
However mergers, which is effectively what this corporate action is, take time to bed down. I don't for one moment expect much of an increase in the share price However both companies have products that the CEO clearly thinks can produce more working together than as separate companies. Also there will be senior management cost savings, I expect, as some senior heads will, in time, exit the business. I know this from personal experience of mergers.

[henryatkin] 24/2/2014 14:28

Oblivion...I agree to a point but there are major sporting events attracting charter flights every year such as Olympics, Winter Olympics, Commonwealth Games, World Cup, F1 races to name but a few. We already know they happen and contribute to income so perhaps there is more to it than you might first think. At a time like this, any good publicity can only be beneficial.

[oblivion0280] 24/2/2014 11:58

Hello, quite new at this but I read the comments about the Winter Olympics as more of an early trading report rather than a desperate attempt to get a counter bid. The language used says to me that when results are announced they will be positive due to previous experiences around sporting events. I would be grateful for anyone else's, more experienced, input on my thoughts.

[gorilla36] 21/2/2014 16:20

igoe104 - I think oldtyke means when "the games " are finished!

[igoe104] 21/2/2014 07:50

Who says finished, more like expanding.

[old tyke] 21/2/2014 07:43

very strange timing: why talk about "we are well-positioned to take advantage of the anticipated increase in demand for private jets around the Winter Olympics", when they are about to finish? Is he desperate to attract a counter-bidder?

[igoe104] 21/2/2014 07:31

Very positive write up.

[adamb1978] 20/2/2014 10:46

Goliard - you're right. Despite talking about it being a reverse I temporarily confused it with a normal acquisition on AIM! The advantage of AIM for a company which wants to acquire is that you dont need to seek shareholder approval for most deals - hence why Vislink recently moved to AIM from teh main market. A reverse does need shareholder approval on our side though

[old tyke] 20/2/2014 09:57

Good analysis Henry A.
Telegraph article has at least one error - according to her ACS is listed! I wonder if Dustin's soliciting that piece (as he surely must have done) is designed to smoke out some other interest?

[goliard] 19/2/2014 20:12

Adam, given the amount of shares we would have to issue (amongst other things) I would have thought it required approval of our shareholders too.

[adamb1978] 19/2/2014 17:57

Henry - if you're referring to HGR8's CEO, its irrelevant as we wont get a vote on it. The vote will be on ACS' side given we're acquiring them, so depends on whatever is in their Articles or Shareholders' Agreement.

[henryatkin] 19/2/2014 16:41

The best hope for us is that the CEO is not a majority shareholder so he would still need another 8% of holders to get over the 50% mark. The deal has to have some benefit other than cost synergies to get that 8% imho.