Summer 2023

Menzies Aviation agrees to buy a majority stake in Portugal’s Groundforce

Menzies Aviation signs Subscription Agreement with TAP Air Portugal and Groundforce’s Insolvency Estate

Agreement with TAP Air Portugal will give Menzies a 65% share of Portugal’s airport ground handling services market, with operations at five airports and more than 3,000 employees

Menzies Aviation has signed an agreement with TAP Air Portugal and Groundforce’s Insolvency Estate to acquire a controlling stake of 50.1% in Groundforce, the airline’s loss-making and insolvent aviation services arm, in a move that will give Menzies a 65% share in Portugal’s airport ground handling services market.

Menzies said the agreement was “a decisive step towards the recovery of Groundforce, reinforcing the confidence of all its stakeholders in the future of this company, and also a significant milestone in strengthening handling capacity, with an impact on the entire national economy”.

Groundforce handles over 100,000 aircraft turns each year across its operations at five of the busiest airports in Portugal: Humberto Delgado Airport (LIS) in Lisbon, Francisco Sá Carneiro Airport (OPO) in Porto, Gago Coutinho Airport (FAO) in Faro, Madeira International Airport (FNC), and Porto Santo Airport (PXO) on Porto Santo Island in Madeira. The aviation services company provides ground and air cargo services to several global airlines including TAP, its main customer.

Preferred bidder
National Aviation Services, which joined forces with Menzies Aviation last year under the ownership of Agility, was selected as a preferred bidder for Groundforce in August 2022. For TAP, this process “is crucial for the stability and improvement of the company’s operational performance, with a direct impact on TAP’s activity and the satisfaction of its customers”.

The executed Subscription Agreement establishes the general terms and conditions of Groundforce’s Recovery Plan. Upon the granting of all necessary authorisations and consents, the Recovery Plan needs to be submitted by the Insolvency Administrators for the review discussion and approval by Groundforce’s Creditors Assembly.

Philipp Joeinig, CEO, Menzies Aviation, said: “Groundforce has had a leading position in the aviation services market in Portugal for decades and we are pleased to have signed this agreement which enables us to enter the market at scale. We will work to ensure a seamless transition for all stakeholders including airline customers and employees.”

Hassan El-Houry, chairman of Menzies Aviation, said: “We have strong conviction in the global aviation industry, and we are encouraged by the pace of recovery for both passenger and cargo volumes following the pandemic disruption. This transaction is further evidence of our scale and ability to enter a market in a meaningful way, as a long-term investor with a strong commitment to deliver industry leading services to airline and airport customers. We look forward to working with the Groundforce team to take advantage of the opportunities in this market.”

Last August, supply chain services and airport services specialist Agility completed its £763 million (US$925 million) acquisition of Menzies Aviation’s holding company John Menzies PLC and began combining the acquired business with its National Aviation Services (NAS) business to create a leading global player in air cargo handling and aviation services. Operating as Menzies Aviation, the combined company provides air cargo services, fuel services and ground services at 251 airports in 58 countries, serving more than 4 million flights a year and handling over 2 million tonnes of cargo.