Bristow Group’s Financing for the $560 Million Combination with Columbia Helicopters

Jefferies LLC is serving as exclusive financial advisor to Bristow. Wachtell, Lipton, Rosen & Katz and King & Spalding are serving as legal counsel to Bristow, and Baker Botts is serving as financing counsel to Bristow. Greenhill & Co., LLC is serving as exclusive financial advisor to Columbia. Tonkon Torp LLP is providing legal counsel to Columbia. Jefferies Finance LLC is providing committed debt financing and Jefferies LLC served as sole placement agent arranging the committed convertible financing.

Bristow Group Inc. (NYSE: BRS), the leading provider of global industrial aviation services, announced today that it has signed a definitive agreement to combine with privately-held Columbia Helicopters, Inc. (“Columbia”) for $560 million. Columbia will be designated as an unrestricted subsidiary under the Columbia name and air operating certificate (AOC).

Bristow expects the complementary transaction to strengthen the company’s operational and consolidated financial profile by delivering adjusted EBITDA and cash flow accretion; reducing consolidated net leverage; diversifying the combined company’s fleet and customer base; expanding its addressable market, especially in the U.S. government sector; and producing significant incremental revenue opportunities.

Founded in 1957 by Wes Lematta and headquartered in Aurora, Oregon, Columbia is the leader in heavy-lift helicopter operations and trusted expert in maintenance, repair and overhaul services, with global operations servicing end-markets that include defense, firefighting, onshore oil and gas, infrastructure and forestry. For the twelve months ended September 30, 2018, Columbia recorded revenues of approximately $281 million and adjusted EBITDA of approximately $117 million1,2. Columbia’s fleet of operating helicopters is comprised of 21 high return tandem rotor Vertol 107 and Chinook CH-234 / CH-47D; with additional non-operational airframes available for deployment with minimal capital expenditure. Columbia also has full MRO and certification capabilities.

Under the terms of the agreement, Bristow will acquire 100% of the equity interests of Columbia for $560 million from the Lematta family and current management. For the twelve months ended September 30, 2018, Columbia recorded revenue of approximately $281 million and adjusted EBITDA of approximately $117 million1,2 resulting in a transaction multiple of 4.8x adjusted EBITDA, excluding the impact of estimated operational and cost synergies. Columbia will be designated as an unrestricted subsidiary and will be fully consolidated on the Bristow financial statements upon transaction close. Jonathan Baliff will serve on the Columbia Board of Directors as a representative of Bristow upon close of the transaction.

The transaction will be funded through a combination of debt, convertible debt, newly issued common shares to the Lematta family and existing Columbia management and cash from Bristow’s balance sheet. Bristow has secured fully-committed debt and convertible debt financing for the transaction. The Lematta family and existing Columbia management, which is committed to leading the Columbia operating subsidiary, will roll over $77 million of their current ownership (including ownership in certain equity awards) into Bristow common stock, up to a maximum of approximately 7.1 million shares. Bristow remains focused on deleveraging and maintaining a strong liquidity position.

The transaction is expected to close prior to December 31, 2018 and is subject to customary closing conditions including the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Act, the satisfaction of certain additional conditions relating to regulatory matters, the receipt of certain designated consents, and other customary closing conditions.

Wachtell, Lipton, Rosen & Katz advised Bristow with a team led by David A. Katz (Picture), and Jenna E. Levine.

Baker Botts represented Bristow in connection with the financing with a team including John Geddes (Partner, Houston); A.J. Ericksen (Partner, Houston); Sarah Berens (Senior Associate, Houston); Lakshmi Ramanathan (Associate, Houston); Emmie Proctor (Capital Markets); Rachael Lichman (Partner, Houston); Lyman Paden (Partner, Houston); Shelley Austin (Special Counsel, Austin); Sarah Christian (Associate, Austin); Malory Weir (Associate, Houston); Samantha Chestney (Banking & Finance); Manny Grillo (Restructuring); Gail Stewart (Partner, Houston); Chris Pratt (Special Counsel, Houston) and Marian Fielding (Employee Benefits).

Tonkon Torp advised Columbia Helicopters with a team led by Justin B. Denton.

Involved fees earner: Justin Denton – Tonkon Torp; Rachael Lichman – Baker Botts; Lyman Paden – Baker Botts; Shelley Austin – Baker Botts; Sarah Christian – Baker Botts; Malory Weir – Baker Botts; John Geddes – Baker Botts; A.J. Ericksen – Baker Botts; Sarah Berens – Baker Botts; Lakshmi Ramanathan – Baker Botts; Emmie Proctor – Baker Botts; Emanuel Grillo – Baker Botts; Gail Stewart – Baker Botts; Chris Pratt – Baker Botts; Marian Fielding – Baker Botts; David Katz – Wachtell, Lipton, Rosen & Katz; Jenna Levine – Wachtell, Lipton, Rosen & Katz;

Law Firms: Tonkon Torp; Baker Botts; Wachtell, Lipton, Rosen & Katz;

Clients: Bristow Group Inc. ; Columbia Helicopters;

Author: Ambrogio Visconti