Innovate Holdings subsidiary acquires UK company Corby Chilled Distribution Limited

10/1/2006 - Innovate Holdings Limited (“Innovate”), in which Avion Group holds a majority interest via its Eimskip division, has acquired the entire share capital of Corby Chilled Distribution Limited (“Corby”), one of the leading players in the UK temperature-controlled primary food distribution market. The purchase price of £28 million plus the assumption of net short-term debt at closing of approximately £500,000 will be financed from Innovate’s own resources and by loans provided by Glitnir banki hf.

Innovate Holdings Limited (“Innovate”), in which Avion Group holds a majority interest via its Eimskip division, has acquired the entire share capital of Corby Chilled Distribution Limited (“Corby”), one of the leading players in the UK temperature-controlled primary food distribution market. The purchase price of £28 million plus the assumption of net short-term debt at closing of approximately £500,000 will be financed from Innovate’s own resources and by loans provided by Glitnir banki hf.

This acquisition furthers Eimskip’s strategy to be a leading logistics provider globally, adding to its existing UK coldstore infrastructure a strong road transportation and cross dock hub network with comprehensive coverage of the UK and substantial capacity for growth.

The transportation and distribution expertise of Corby is complimentary to the existing cold-storage and logistics capabilities of Innovate, allowing the combined group to offer a “one-stop” service to customers and increases the Innovate’s capacity across all temperature ranges. Furthermore, there is a strong strategic fit between the geographic networks of the two companies allowing for significant operational synergies.

Corby has a 13-year track record of growth in the temperature-controlled food distribution market from inception in 1993. Corby has long standing relationships with many of the key UK food retailers, manufacturers and growers and is equipped to manage short order lead times whilst maintaining a superior level of service for its customers.

Corby has a strong and experienced management team that has developed with the business and who will be integrated into the Innovate management structure. Iain Stewart, MD of Corby, will become Chief Operating Officer of the enlarged Chilled division of Innovate Logistics.

Audited financials: In the year to 30 April 2006, Corby recorded turnover of £51.1 million (2005: £53.5 million) and EBITDA of £4.2 million (2005: £3.6 million). As at 31 April 2006 it had net assets of £8.6 million, including freehold properties with a book value of £5.8 million and an estimated investment value of £13.1 million.

Commenting on the transaction, Magnus Thorsteinsson, Chairman of Avion Group, said:

“We are delighted that Innovate has acquired Corby and thus welcome it into the Avion Group. The businesses are highly complementary and together will be able to offer our customers an enhanced range of services in temperature-controlled logistics in the UK”.

About Eimskip

Eimskip offers total transportation solutions to its customers, including ocean freight, reefer logistics, air freight and inland transportation, with particular expertise in temperature controlled logistics and storage. Eimskip operates at 88 operational bases in Europe, North America, South America and Asia. The company operates 36 vessels, 400 trucks and over 40 coldstores. Eimskip is a subsidiary of Avion Group. The company was the first shipping line in Iceland established 1914, through the years it has evolved from being a shipping line to a total transportation and logistics company. Eimskip employs 3.000 people, two-third of whom work in other countries than Iceland.

About Avion Group

Avion Group is a leading investment company, focused on air, land and sea transportation solutions worldwide. The company is organized into three business divisions -- Aviation Services, Charter & Leisure and Shipping & Logistics. Aviation Services consists of ACMI (Aircraft, Crew, Maintenance, Insurance) provider Air Atlanta Icelandic, maintenance provider Avia Technical Services and airport handling provider Southair. Charter & Leisure is represented by leisure service travel provider Excel Airways Group in the UK, Star Airlines, the second biggest charter airline in France and the newly founded airline Star Europe in Germany. There are currently approximately 60 Boeing and Airbus aircraft in the fleet. The Shipping and Logistics division is represented by Eimskip, the market leading transport company in the North Atlantic and the prime maritime transportation company in Iceland. Avion Group employs close to 6,500 people at 118 operational bases worldwide.

Contact Information

Dögg Hjaltalín

Director - Investor Relations

Avion Group

Contact via E-mail