gategroup plans IPO and listing on SIX Swiss Exchange

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• SIX listing planned end of Q1 or in Q2 2018
• Global leader in airline catering, with strong presence in 60 countries and territories
• Revenue and profit margins development reflects strong growth trajectory
• Expected primary proceeds of approximately CHF 350 million
• Envisaged free float (post over-allotment option) approximately 65% of gategroup’s share capital
• Highly qualified Executive Management Board and experienced, majority independent Board of Directors

gategroup Holding AG (the “Company”), the world’s largest provider of airline catering services in terms of revenues, today announces its plan to list its shares on SIX Swiss Exchange. The envisaged Initial Public Offering (IPO) is expected to take place at the end of Q1 or in Q2 2018.

Over the past two years, gategroup has focused its business activities on its core competencies of airline catering and retail on board, expanded its global footprint and increased both revenue and profit. Proceeds from the IPO will provide the Company with enhanced flexibility to, among other things, continue delivering under the Gateway 2020 strategy and exploit future growth opportunities.

The current sole owner of gategroup, HNA Aviation (Hong Kong) Airline Catering Holding Co. Ltd, an HNA entity, intends to sell the majority of its holdings in gategroup and has indicated to the Company its plan to remain a long-term anchor shareholder. The envisaged post-IPO free float, assuming the full exercise of the over-allotment option (greenshoe), is about 65% of gategroup’s share capital.

Adam Tan, CEO of HNA Group, said: “We are proud of the significant progress gategroup has made over the past two-and-a-half years. The Company stands on a very solid foundation and is ready to continue and further accelerate its recent growth path. We believe the envisaged IPO will allow gategroup to bring new, innovative products and services to the market and to expand in new markets. As a strategic investor and anchor shareholder, HNA will continue to support gategroup with relevant industrial and market expertise, not only based on our experience in the airline industry but also given our global footprint.”

Xavier Rossinyol, CEO of gategroup, said: “As the global leader in airline catering and food and beverages retail on board, gategroup and its management team are excited about the prospect of becoming a public company again. The planned IPO underpins the successful and consistent execution of our Gateway 2020 strategy thus far and allows us to accelerate ongoing investments in our future growth. HNA has been a strong supporter and enabler of this transformation. Our new Board of Directors will provide their leading industry expertise and strong guidance to help us meet the continued high ambitions of the company.”

Free float of approximately 65%
The offering is planned to consist of primary and secondary shares and a greenshoe of up to 10% of the base size of the transaction. The primary offering is expected to result in proceeds for the company of approximately CHF 350 million.

The proceeds from the primary offering are expected to be used for the acquisition of the remaining shares of Servair from Air France-KLM, the funding of pension plans and other corporate purposes. Overall, the envisaged IPO aims at a free float of around 65% of all shares (assuming full exercise of the over-allotment option). gategroup will not receive any proceeds from the sale of the secondary shares.

Leading airline caterer
gategroup is the global leader in airline catering, retail on board and hospitality products and services. Headquartered in Zurich Glattbrugg, Switzerland, the Company is committed to providing operational excellence and to serve customers worldwide through its global catering network. gategroup employs approximately 43,000 employees worldwide and serves more than 700 million passengers annually from over 200 operating units in 60 countries/territories across all continents.

Diversified long-term relationships with customers
gategroup enjoys long-term relationships with most of those customers that represented a majority of its revenues in 2017. The Company believes that its contracted revenue base, its long-term relationships with a broad range of well-known customers and strong track record in renewing and winning new contracts help maintain stable returns from the Company’s customer portfolio.

Proven track record in product innovation
gategroup has four established Centers of Excellence: Culinary, Retail, Technology and Product Innovation. gategroup believes its ability to deliver innovative products and services is key to provide the extensive, tailored and differentiated offering that its customers and their passengers demand and, in particular, to achieve a level of passenger satisfaction that generates a stronger and more sustainable relationship with its customers.

Focus on operational excellence and standardization
Operational excellence is deeply embedded in gategroup’s organizational structure and culture. Providing superior quality services to customers is paramount to the Company’s success. To this end, gategroup has established a corporate ecosystem and a holistic internal certification program, GateOPEX, that ensures global consistency of services and compliance with the Company’s high-quality operation standards and best practices within the Group.

Strong growth momentum
Led by an experienced management team, gategroup has established a track record of delivering growth in terms of revenue and margins, both as a result of organic growth as well as the completion of strategic acquisitions, including the acquisition of Servair. In 2017, revenue grew by 35% to CHF 4.6 billion compared to 2016, EBITDA reached CHF 300 million (+50% compared to 2016) and net profit reached CHF 85.2 million (+161% compared to 2016). Through the successful execution of its Gateway 2020 strategy, gategroup has turned into a highly focused company that has significantly increased its geographical scope, in particular in emerging markets. gategroup benefits from a broad and diversified client base of more than 300 customers and a strong average contract retention rate of more than 90% over the last two years. gategroup believes its strong focus on commercial innovation creates a distinctive competitive advantage for the Company.

Highly experienced management and independent Board
gategroup is led by an experienced and committed board of directors (the “Board”) and a highly successful management team.

Under the leadership of CEO Xavier Rossinyol, gategroup is managed by a highly committed executive management board whose six members combine long experience in catering, airline, retail, M&A and cost discipline in world-leading companies. The team achieved an impressive turnaround of the company within only two-and-half years, clearly positioning gategroup today as the No. 1 in global airline catering. 

The Board will be comprised of nine directors, three appointed by HNA, one executive and five independent. It will be chaired by Adam Tan. The members of the Board are not only recognized experts on the aviation industry, inflight catering and food and beverage, but also on specific market segments and disciplines required to materialize gategroup’s strategy: leading innovation; services for retail and consumer goods; asset optimization across the entire food and aviation supply chain, contract and concession catering globally and particularly in emerging markets; M&A towards global consolidation, portfolio management and buy-and-build; global and or regional leadership in mature and emerging markets; stakeholder management, audit and finance.

The new Board is comprised of the following members:  

Adam Tan, Chairman of the Board
Adam Tan is co-founder, vice chairman of the Board and chief executive officer of HNA Group. Prior to becoming chief executive officer in 2016, Mr. Tan served as president of HNA Group, chairman of HNA Capital and executive chairman of HNA Industry Holding. Currently, he is also the chairman of HNA Innovation Finance Group. He has been appointed to the Board by HNA.

Stewart Smith, Vice Chairman of the Board
Stewart Smith is chairman of Bravia Capital, a Hong Kong-based private equity, structured finance and advisory firm. Before joining in 2002, he followed a career in banking in the United Kingdom with Norwegian bank, DNB Bank primarily in senior general management positions. Mr. Smith is a non-executive director of a number of other HNA Group companies in transportation and logistics. He has been appointed to the Board by HNA.

Frank Nang, Member of the Board
Frank Nang is chief innovation officer of HNA Aviation Group and chairman of the board of directors of HNA Catering Service Company. He joined the HNA Group in 2006 as technical engineer of Hainan Airlines. Since 2010 he held various positions with increasing responsibility particularly in finance in various HNA units. Prior to being nominated as chief innovation officer of HNA Aviation Group he worked as deputy manager of HNA’s financial department. He has been appointed to the Board by HNA.

Paolo Amato, Member of the Board (Independent)
Paolo Amato has extensive aviation, airline services and industrial experience and currently advises various private equity funds. He previously served as director of the board of CIFC Asset Management LLC and Octo Telematics Ltd., portfolio companies of Renova Management AG. Previously, he served as non-executive director with both companies and was chairman of the board of Air One S.p.A. and board member of Indesit S.p.A. Mr. Amato served at Alitalia first as executive vice president and chief financial officer and later as deputy general manager. He also was a board member for several airports in Russia.

Carla Cico, Member of the Board (Independent)
Carla Cico has a successful track record in board and executive positions on three continents in telecommunications, manufacturing, and travel retail. She served on the board of e2v Technologies; World Duty Free Plc, a leading travel retailer; and communications provider Alcatel-Lucent. Ms. Cico served for five years as chief executive officer of Brasil Telecom SA and then as chief executive officer of Ambrosetti in China and of Rivoli SpA. She is non-executive director of Allegion Plc, a NYSE listed global provider of security solutions and chairman of Esendex Messaging Group, a privately-held company.

Dennis Malamatinas, Member of the Board (Independent)
Dennis Malamatinas has held chief executive officer and chairman positions of global consumer goods, retail and food and beverage companies. Mr. Malamatinas serves as non-executive chairman of FocusVision, chairman of the advisory board of IBANFIRST, member of the advisory board of MidOcean Partners and as an industrial advisor to EQT. Previously, he served as an executive director of Diageo plc., non-executive Director of Reuters plc., non-executive Director of the SSP Group, non-executive chairman of Metro International Ltd. and as non-executive chairman of Sbarro Inc. Mr. Malamatinas served as the global chief executive of Burger King Corp., global chief executive of Smirnoff Vodka, founding chief executive officer and chairman of Priceline Europe Ltd., as well as president and chief executive officer of PepsiCo Italy. He started his career at Procter & Gamble Co. in brand management. Mr. Malamatinas was appointed as one of the five founding members of President Clinton’s Welfare to Work Partnership.

Ajai Puri, Member of the Board (Independent)
Ajai Puri has broad consumer and industrial experience in the fields of food and beverage, innovation, nutrition marketing and product safety, which he gained during his professional career with Cadbury Schweppes, The Minute Maid Company, The Coca-Cola Company and Royal Numico NV. Previously, he was on the board of directors of Barry Callebaut and Nutreco NV. Before that, Mr. Puri was an executive board member at Royal Numico NV (now part of Groupe Danone.) Mr. Puri serves as board member of Firmenich, the world’s premier manufacturer of flavors and fragrances, Tate & Lyle plc, a global provider of specialty food ingredients, and Britannia Industries Limited, India’s largest independent food group.

Frederick W. Reid, Member of the Board (Independent)
Frederick W. Reid has held a number of board and executive positions of over thirty years dedicated to the aviation industry. He served as president of Flexjet, Inc. and was founding chief executive officer of Virgin America. Mr. Reid was also president and chief operating officer of Delta Air Lines and, prior to that, was Delta’s chief marketing officer and served as the chairman of the board of directors of Delta Connection Inc. Before that, he held executive roles at Lufthansa German Airlines. He started his career at Pan American World Airways. Fred Reid is president of zee.aero, a Californian company developing and building new generation personal aircraft.

Xavier Rossinyol, Member of the Board (Executive)
Xavier Rossinyol has more than 20 years of experience in the airline, catering and retail sector, ranging from travel retail to concession, contract and in-flight catering.  He joined gategroup as chief executive officer in April 2015. Prior to joining gategroup, Mr. Rossinyol held numerous leadership positions at Dufry, a publicly traded global travel retailer, including as chief operating officer EMEA and Asia and as group chief financial officer. From 1995 to 2004, he worked for the Spanish-based Grupo Áreas, a subsidiary of Paris-based Group Elior, a world leader in contract and concession catering.

Media inquiries
Nancy Jewell
+41 44 533 7081
njewell[at]gategroup.com

About gategroup
gategroup is the global leader in airline catering, retail-on-board and hospitality products and services. We provide passengers with superior culinary and retail experiences, leveraging our innovation and advanced technology solutions. Headquartered in Zurich, Switzerland, we deliver operational excellence through the most extensive catering network in the aviation industry, serving more than 700 million passengers annually from over 200 operating units in 60 countries/territories across all continents. In 2017, gategroup reached CHF 4.6 billion in revenues and approximately 43,000 employees worldwide. For further information, please visit www.gategroup.com

Disclaimer

This publication is not an offer to sell or a solicitation of any offer to buy any securities issued by gategroup Holding AG (the "Company") in any jurisdiction where such offer or sale would be unlawful.

This publication is not an offer to sell or a solicitation of offers to purchase or subscribe for securities. This publication is not a prospectus within the meaning of Article 652a of the Swiss Code of Obligations, nor is it a listing prospectus as defined in the listing rules of the SIX Swiss Exchange AG or a prospectus under any other applicable laws. A decision to invest in securities of the Company should be based exclusively on the issue and listing prospectus to be published by the Company for such purpose. Investors are furthermore advised to consult their bank or financial adviser before making any investment decision. This document does not constitute an "offer of securities to the public" within the meaning of Directive 2003/71/EC of the European Union, as amended (the "Prospectus Directive") of the securities referred to herein in any member state of the European Economic Area (the "EEA"). Any offers of the securities referred to in this document to persons in the EEA will be made pursuant to an exemption under the Prospectus Directive, as implemented in member states of the EEA, from the requirement to produce a prospectus for offers of the securities. In any EEA Member State that has implemented the
Prospectus Directive, this document is only addressed to and is only directed at qualified investors in that Member State within the meaning of the Prospectus Directive, i.e., only to investors who can receive the offer without an approved prospectus in such EEA Member State.

This publication and the information contained herein are not for distribution in or into the United States of America (the “United States”). This publication does not constitute an offer to sell, or a solicitation of an offer to purchase, any securities in the United States. Any securities referred to herein have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”), and may not be offered or sold within the United States absent registration or an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. There is no intention to register any securities referred to herein in the United States or to make a public offering of the securities in the United States.

In the United Kingdom, this publication and any other materials in relation to the securities described herein is only being distributed to, and is only directed at, and any investment or investment activity to which this document relates is available only to, and will be engaged in only with, “qualified investors” (as defined in section 86(7) of the Financial Services and Markets Act 2000) and who are (i) persons having professional experience in matters relating to investments who fall within the definition of “investment professionals” in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”); or (ii) high net worth entities falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as “relevant persons”). Persons who are not relevant persons should not take any action on the basis of this document and should not act or rely on it.

Forward-Looking Statements
This publication contains forward-looking statements and other statements that are not historical facts. The words “believe”, “anticipate”, “plan”, “expect”, “project”, “estimate”, “predict”, “intend”, “target”, “assume”, “may”, “will” “could” and similar expression are intended to identify such forward-looking statements. Such statements are made on the basis of assumptions and expectations that we believe to be reasonable as of the date of this publication but may prove to be erroneous and are subject to a variety of significant uncertainties that could cause actual results to differ materially from those expressed in forward-looking statements. Among these factors are changes in overall economic conditions, changes in demand for our products, changes in the demand for, or price of, oil, risk of terrorism, war, geopolitical or other exogenous shocks to the airline sector, risks of increased competition, manufacturing and product development risks, loss of key customers, changes in government regulations, foreign and domestic political and legislative risks, risks associated with foreign operations and foreign currency exchange rates and controls, strikes, embargoes, weather-related risks and other risks and uncertainties. We therefore caution investors and prospective investors against relying on any of these forward-looking statements. We assume no obligation to update forward-looking statements or to update the reasons for which actual results could differ materially from those anticipated in such forward-looking statements, except as required by law.

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