ZURICH and TORONTO, Sept. 15, 2010 – gategroup and Cara Operations Limited (“Cara”) announced today that they have reached an agreement for gategroup to acquire Cara Airline Solutions, Canada’s premier airline catering and logistics provider. When completed, the transaction immediately will establish gategroup’s core brand Gate Gourmet as a major player in the Canadian airline services market, where it currently does not have a presence.
Cara Airline Solutions, which operates 10 facilities at some of Canada’s busiest and largest airports, achieves annual revenues of approximately CHF 200 million. Further details of the agreement were not disclosed. The transaction is subject to customary closing conditions and approvals.
“Adding Cara Airline Solutions to our portfolio fits well with our strategy to increase shareholder value by taking advantage of attractive acquisition opportunities and growing with hub carriers in hub markets,” said gategroup Chief Executive Officer Guy Dubois. “This transaction will complement our market presence in North America where management expects annual revenue will then approach CHF 1 billion. It will also allow us to leverage our skills and resources to achieve operational synergies and enhanced market access,” he added.
Cara Airline Solutions serves over 55 Canadian and international airline and rail customers. Cara Airline Solutions’ key customers include Air Canada, Air Transat, Jazz, British Airways, Air France, Air China, Jet Airways, China Airlines, and VIA Rail Canada, Canada's national passenger rail service.
Andrew Gibson, group senior vice president and president, North America region, said, “Adding Canada to our network will not only introduce us to new customers, but also allow us to strengthen existing relationships by offering a more robust lineup of cost-effective, innovative onboard solutions across the Americas through gategroup’s various brands.”
“Cara Airline Solutions is an important and significant part of our company’s history, so it was important to find the right buyer,” said Don Robinson, Cara president and chief executive officer. “Our diligence has paid off; gategroup, as an international leader in the industry, understands our customers and the unique, global environment in which we operate. It can offer our employees and customers even more solutions, specialized support and expertise and leadership. We have confidence that gategroup will foster the continued success and long-term growth of the business.”
The sale of Cara Airline Solutions marks the final milestone in Cara’s strategy to focus its operations on its branded restaurant business, which includes leading Canadian brands Swiss Chalet, Harvey’s, Milestones, Montana’s and Kelsey’s.
Cara Airline Solutions employs approximately 2,800 associates and has operations in Calgary and Edmonton, Alberta; Halifax, Nova Scotia; Montreal and Quebec City, Quebec; Ottawa and Toronto, Ontario; Regina, Saskatchewan; Vancouver, British Columbia; and Winnipeg, Manitoba.
“Cara Airline Solutions has a long and proud history of serving the airline industry and its passengers. We look forward to welcoming Cara Airline Solutions’ associates into the gategroup corporate family and to combining and leveraging the respective companies’ capabilities, after closing conditions have been met,” said Gibson, noting that he and Rob Ramage, president, Cara Airline Solutions, will work closely together through the transition to ensure a successful and seamless integration for employees and business partners.