By Rob Russell
Agility, a supply chain services and infrastructure and company, based in Kuwait, has finalised its acquisition of UK-based John Menzies. It will combine the business with its National Aviation Services (NAS) business to create aviation services in 58 countries.
For more than a century, John Menzies was a steadfast high street presence across the UK. Just over 20 years ago, it vanished from town centres and railway stations. But the business has continued to grow, from a Victorian bookseller in Scotland's capital, into a massive distribution firm, then a global aviation services business. Its founder, the original John Menzies, was a man with a talent for finding a niche and adapting to a changing society.
The first link to air travel came with the 1948 launch of a bookstall at Edinburgh Turnhouse Airport but by the 1980s John Menzies' daily distribution of 26.5m newspapers put the company in a position to move into overnight and heavy freight. The retail presence vanished from the high street in the late 1990s as rival WH Smith acquired its shops. By then the company was a global distribution service with a focus on cargo handling and passenger services.
In 1987, the directors began to lay the groundwork for the business as it is today. The acquisition of Scan International Group and Cargosave saw Menzies beginning to handle large volumes of overnight and heavy freight. Further acquisitions and contract wins saw the business begin cargo transport and handling at London’s Heathrow Airport. It now operates at airports on six continents, worldwide and in 1995, the business moved to new modern headquarters at Edinburgh Park, where it is still based today. Between 2002 and 2008, international expansion moved apace with the acquisition of cargo and distribution businesses in the Netherlands, USA, Australasia, Sweden, Norway, and South Africa to name a few, and operations in many other countries were being driven by contract wins.
NAS is an aviation services provider head-quartered in Kuwait City, Kuwait. The company currently operates at 55 airports in emerging markets countries across Africa, Asia and the Middle East. In 2006, NAS began its first operations outside of Kuwait in Aqaba before starting its operations in India and Sudan in 2010, Ivory Coast in 2015 and Morocco in 2016. In 2008, NAS received IATA Safety Audit for Ground Operations (ISAGO).
In 2017, NAS acquired Entebbe Handling Services (ENHAS) and rebranded it to National Aviation Services Uganda in the same year, NAS started operations in Liberia followed by DRC, Iraq, Italy and Guinea Bissau in 2020. In April 2021, NAS entered into an agreement with Bidvest Group Limited to acquire BidAir Services for an undisclosed amount and completed the deal in June 2021. In October 2021, NAS acquired 51% equity interest in Siginon Aviation an aviation cargo management and ground handling, and a subsidiary of Siginon Group of Kenya for $40 million as a result, NAS took over management in Siginon Aviation.
Agility was established in 1979 as a state-owned company in Kuwait. Its original name was Public Warehousing Co. (PWC). Tarek Sultan was named chairman and managing director when the company was privatized in 1997. After privatization, Agility pursued a strategy of investment and expansion. Through acquisitions and the establishment of new offices, it built a global presence in the Middle East, Asia, Africa and Latin America, where many of its more established competitors had yet to set up, and in the developed markets of Europe and North America. The company grew rapidly by acquiring other logistics companies and assets such as warehouses and trucks. Among its most significant acquisitions were the USA-based companies Geologistics Corp., Transoceanic Shipping Co. Inc., WTS of Houston and Global Express Line. Also purchased were Singaporean company Trans-Link Group; Swiss company Cronat Transport Holding AG; Globe Marine Services of Saudi Arabia; Cosa Freight in China; Kenya-based Starfreight; and Tristar Transport of UAE. The company also expanded Latin American operations with the acquisition of Trafinsa SA de CV in Mexico and Itatrans in Brazil.
By 2004, Agility, then still PWC, was the largest logistics provider in the Middle East. In 2006, the company unified its services under the new name of Agility with the brand slogan “A New Logistics Leader.” Agility sold its commercial freight forwarding and logistics business in 2021 to DSV Panalpin for shares in the combined company, becoming the second-largest shareholder in the world’s third biggest freight forwarder.
The boards of Agility and Menzies reached an agreement on March 30 on Agility’s cash offer to acquire 100% of Menzies ordinary shares, which traded on the London Stock Exchange, for 608 pence a share. The deal values Menzies at approximately £571 million on a fully diluted basis and approximately £763 million on an enterprise value basis.
Agility Vice Chairman Tarek Sultan said, “This is a new chapter for Agility, Menzies, and NAS. By acquiring Menzies and combining it with NAS, Agility has the opportunity to unlock greater value in both. Agility has a strong track record of sustainable and responsible growth over the last two decades, driven both organically and through mergers and acquisitions, and this latest deal is part of our strategy to further accelerate that growth. For Agility, this deal creates the largest owned and operated – “controlled” – business in Agility’s portfolio by revenue, headcount, and global presence. We’re looking forward to seeing the new Menzies soar with Agility’s backing.”
Once integrated, the combined company will operate as Menzies Aviation and will be the world’s largest aviation services company by a number of countries and the second largest by the number of airports served. Operating as Menzies Aviation, the combined company will provide air cargo services, fuel services and ground services at airports on six continents.
The combined revenues of Menzies and NAS exceeded $1.5 billion in 2021. The new company will have approximately 35,000 employees and operations at 254 airports in 58 countries, handling 600k aircraft turns, 2 million tonnes of air cargo and 2.5 million fuelling turns per year.