Cavendish

Cavendish sells majority stake in UK airline Astraeus to Icelandic Investment Group

Cavendish is delighted to announce that Fons Eignarhaldsfelag, the Icelandic investment company, has today entered into a binding agreement to acquire a majority shareholding in Astraeus, the niche UK airline based at London Gatwick.

Fons is headed by Palmi Haraldsson and Johannes Kristinsson and has a number of aviation interests including Iceland Express. Palmi has a wide variety of other business ventures in the retail industry.

The arrangement will see Astraeus continue to operate its existing route structure from London Gatwick and Manchester, whilst at the same time providing back-of-house support and assistance to other airlines in Fons' expanding portfolio of investments. Exciting developments are in prospect, particularly in the Scandinavian arena, where Iceland Express has just announced an expanded route network of flights from Summer 2007.

Fons will invest £5 million to take a 51% stake in Astraeus. The remaining 49% of the shareholding will be held in equal portions by Astraeus' management and Aberdeen Asset Management, the private equity provider which supported the airline's launch in 2002.

Managing Director of Astraeus, Hugh Parry commented: "Today's announcement opens up fantastic opportunities for Astraeus. The strong financial backing from Fons will enable us to press ahead with an exciting programme of development to extend Astraeus' route network and high quality of customer service into new markets. It will also enable us to benefit from economies of scale in purchasing, flight operations and technical areas by working with the other airlines under Fons' ownership."
[Paul Herman] of Cavendish Corporate Finance commented: ''We are delighted that Astraeus has a new financial backer that will be able to develop the business further over the coming years. Our exercise involved identifying investors from both the UK and overseas. Fons were one of the few investors who were able to see a bright future for the business and have structured their investment to benefit from significant growth in the coming years.''
Neil Macfadyen, Investment Director of Aberdeen Asset Managers Private Equity, said "this is the start of a bright co-operation with Fons and we are delighted to have them on board as we progress our expansion plans in Astraeus."

Cavendish contacts for further information:
[Paul Herman], Director
[Peter Gray], Director

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