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Fuel a more sustainable future

Golden Falcon MNG MNG Airlines, a Global Logistics Provider and e-Commerce enabler, signs agreement to go public on the New York Stock Exchange through a business combination with Golden Falcon Acquisition Corp.

MNG Airlines is a global logistics provider and e-commerce enabler, servicing over 15,000 corporate customers across 41 countries through over 3,500 flights per year .

Recently announced financials for the third quarter ended 30 September 2022 reflected last twelve months (LTM) revenue grew by 39% year over year to $353 million, net income of $61 million and Adjusted EBITDA1 of $116 million (33% margin).

The transaction is expected to have a pro-forma enterprise value of $676 million, assuming minimum gross transaction proceeds of $30 million, implying a 5.8x multiple on LTM Adjusted EBITDA as of 30 September 2022.

NEW YORK, 07 December 2022 – MNG Havayollari ve Tasimacilik A.S. (“MNG Airlines,” “MNGA” or “the Company”), a global logistics provider and e-commerce enabler, has entered into a definitive agreement to become publicly traded via a business combination with Golden Falcon Acquisition Corp. (“Golden Falcon”) (NYSE: GFX), a special purpose acquisition company. The transaction is expected to close in the first half of 2023, after which MNGA will be listed on the New York Stock Exchange (the “NYSE”) under the new ticker symbol “MNGA”. As a public company, MNGA is expected to gain increased financial flexibility, and to be well positioned to unlock new growth avenues and maximize value creation.

Ali Sedat Özkazanc, CEO of MNGA, commented, “We see significant value creation potential from becoming a publicly listed company in the U.S., with the expectation that it will enable transformative commercial agreements, create an acquisition currency, and align management incentives with shareholders.”

Murathan Gunal, Chairman of MNGA and CEO of MAPA Group, added, “Today, MNGA is an international company with a global presence including multinational corporate clients in the U.S., Europe and Asia. In the year that we celebrate 25 years of operational excellence, listing on the NYSE feels like a natural next step in our company’s history. We’re excited about delivering on the anticipated value creation opportunity ahead.”

Makram Azar, CEO of Golden Falcon, commented, “We screened over 500 companies and conducted in-depth due diligence on many companies and our process resulted in identifying a company that offers the market a differentiated, high-quality business. We believe MNGA is an exceptional opportunity among DeSPAC business combinations, with a strong growth profile, profitability, cash flow generation, and priced at what we believe is the lowest EBITDA multiple of any business combination closed to date in 2022, which is why we believe it is such a
compelling investment opportunity.”

Scott Freidheim, Chairman of Golden Falcon, added, “At our initial public offering in December 2020, we communicated to investors that we intended to bring to them an established company in the Europe, Middle East and Israel region with a compelling track record, cash flow-generation, a clear transatlantic expansion nexus, a strong growth profile, and benefitting from secular market tailwinds. We’re delighted to bring this differentiated investment opportunity to our investors as we believe MNGA meets the attributes we laid out as key business combination criteria.”

For the three months ended 30 September 2022, the Company’s revenue grew by 47% year-on-year to $90 million, net income of $26 million and Adjusted EBITDA5 of $27 million (30% margin). Last twelve months6revenue grew by 39% year-on-year to $353 million, net income of $61 million and Adjusted EBITDA of $116 million (33% margin). Adjusted EBITDA margin for the last twelve months has improved by 400 basis points as compared with 2019, and revenue has grown at a 37% compound annual growth rate during this period.

The Company’s business model has four complementary segments: Scheduled & Block Space, Charter, ACMI7, and Warehouse & Handling. The Company’s cost base is mostly variable, with COGS (cost of goods sold) representing 95% of its overall cost base in 2021. Company contracts have limited exposure to fuel costs, which are either 100% pass-through to the end customer (for charter flights and ACMI) or updated every two weeks (for scheduled flights). Revenues are generated in USD, EUR and GBP, collectively accounting for 98% of the total. The Company has been net income-positive for the last 10 years. The Company has net debt8 of $25 million as of 30 September 2022.

The transaction is expected to have a pro-forma enterprise value of $676 million, assuming minimum gross transaction proceeds of $30 million, implying a 5.8x multiple on LTM Adjusted EBITDA as of 30 September 2022.

All references to available cash from the trust account and retained transaction proceeds are subject to any redemptions by the public stockholders of Golden Falcon. The Company benefits from significant positive cash flow generation and a capex-light business model, being able to organically fund its growth plans. Its current business plan is fully funded regardless of transaction proceeds. Net proceeds from the transaction will therefore be distributed to the Company’s existing shareholders, who are expected to continue to retain a significant stake in the Company.

The Golden Falcon management team screened over 500 potential targets since its IPO in December 2020. Prior to executing the Business Combination Agreement with MNGA, the Golden Falcon team conducted extensive due diligence throughout the course of the past ten months, supported by its advisor UBS Investment Bank. In order to closely align incentives with the Company and existing shareholders, the Golden Falcon team has agreed to subject over 90% of sponsor shares received as merger consideration to a vesting schedule.

The proposed business combination, which has been unanimously approved by both the Board of Directors of Golden Falcon and the Board of Directors of MNGA, is expected to close in the first half of 2023, subject to approval by Golden Falcon’s stockholders and other customary closing conditions.

Subject to agreement on terms that are satisfactory to the Company and Golden Falcon, in order to provide certain redemption alternatives in connection with Golden Falcon’s stockholder vote to approve the business combination, the Company and Golden Falcon intend to make available to Golden Falcon stockholders some or all of the following options: (i) continue to hold their shares of Golden Falcon Class A Common Stock (“Common Stock”), (ii) elect to redeem their shares of Common Stock in accordance with the Golden Falcon Certificate of Incorporation or (iii) convert their shares of Common Stock into a newly issued security to be comprised of a combination of shares of Common Stock and convertible notes. The Company and Golden Falcon intend for the newly issued security referred to in (iii) above to entitle such Golden Falcon stockholder to receive a portion of the value of its shares in the form of shares of Common Stock and a portion in the form of registered convertible notes, with both a cash coupon, a conversion premium, and other material terms that are expected to be mutually agreed by the Company and Golden Falcon.

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