Hey all-

Can anybody give me an opinion on what this all means?
AMC bought by American Securities

I don't know anything about the company that bought them.

Thanks,

Bruce

Air Methods to be acquired by American Securities
Posted on March 14, 2017; Air Methods Press Release

Air Methods Corporation, a global leader in air medical transportation and air tourism, on March 14 announced that it has entered into a definitive agreement to be acquired by affiliates of American Securities LLC. Under the terms of the agreement, affiliates of American Securities will acquire all outstanding shares of Air Methods for $43.00 per share in cash. This represents a 20.4 percent premium to Air Methods’ stock price of $35.70 on Jan. 31, 2017, prior to press speculation regarding a sale, and a 24.7 percent premium to 30-day volume-weighted average price of $34.49 as of the same date. The transaction, which was unanimously approved by Air Methods’ board of directors, has a total enterprise value of approximately $2.5 billion, including net debt.
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“This transaction will enable us to continue to execute against our strategy and strengthen our market position as a global leader in air medical transportation and air tourism,” said Aaron Todd, chief executive officer. “American Securities offers us a great opportunity to continue to invest and pursue long-term growth with greater operational flexibility, and we look forward to working with such a sophisticated private equity investor. Importantly, patients, employees, customers and partners will continue to benefit as we execute against our strategy.”

Air Methods is the largest domestic air medical transport provider in the $5 billion air medical market, serving 48 states with over 300 bases of operations and one of the youngest fleets in the industry. Air Methods also maintains a leading position in the complementary air tourism business, with access to attractive fast-growing end markets. The company’s multi-pronged strategy to drive long-term growth includes a focus on improving the utilization of the company’s assets, growing the company’s air medical footprint in underserved markets and increasing the revenue and profitability of the tourism operations.

“We are pleased to have reached this agreement, which will deliver certain and immediate cash value and a compelling premium to our stock price prior to press speculation for our shareholders,” said C. David Kikumoto, Air Methods’ chairman of the board of directors. “We are confident that today’s announcement represents the best path forward for all of Air Methods’ stakeholders and appreciate the leadership of Morad Tahbaz, the chairman of the Finance & Strategic Planning Committee, who led the board through this process.”

“We strongly believe in Air Methods’ strategic direction and the opportunities to grow the company’s leading positions in the attractive air medical and air tourism markets,” said Marc L. Saiontz, a managing director of American Securities. “We respect the company’s commitment to providing access to patients in the communities that need it the most, with a focus on quality of care and safety in aviation. We look forward to partnering with the Air Methods team to drive value.”
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The transaction will be completed through a cash tender offer for all of the outstanding common shares of Air Methods, followed by a merger in which remaining common shares of Air Methods would be converted into the right to receive the same $43 cash per share price paid in the tender offer. Air Methods’ board of directors unanimously recommends that Air Methods shareholders tender their shares in the offer. The transaction is conditioned upon satisfaction of the minimum tender condition, which requires that shares representing more than 50 percent of the Air Methods’ outstanding common shares be tendered, as well as other customary closing conditions, including expiration of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. The transaction is expected to close by the end of the second calendar quarter of 2017.

Goldman, Sachs & Co. and Centerview Partners LLC are serving as financial advisors and Paul, Weiss, Rifkind, Wharton & Garrison LLP and Holland & Hart LLP are serving as legal advisors to Air Methods. Weil, Gotshal & Manges LLP is serving as legal advisor to American Securities.
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In what regard? Do you work for them? Are you an investor? If so in which company>

Probably the cost of medical air evacs will go up as will tourism rides. As for what it means for the employees of Methods Corporation, that is uncertain. Layoffs may be considered. That is the process followed in acquisitions in the pharma industry.

If you own stock in Air Methods, you will receive $43 per share.

American Securities is a privately held company.

41

I'm most interested in American Securities and their history with companies that they acquire. How do they make their money? Short term or long term strategies? What do they do with them? Run them or dismantle them and sell off assets?

Bruce

I wouldn't anticipate that they will dismantle and sell off Air Methods assets. They provide a necessary service and will continue to do so.

I would anticipate, however, that the cost of your flight is going to go up as everything does.

When I first started flying with a civilian helicopter rescue team in 1990, our average bill for a rescue was somewhere in the neighborhood of $1500. When I had to use the same flight team last year to transport me the bill was around $30,000. I'd guess that that is the going rate for all teams nowadays, and as I said, I'd expect it to go up even more with this acquisition and any of Air Methods contracts.

quote:

Originally posted by Gustofer:
I wouldn't anticipate that they will dismantle and sell off Air Methods assets. They provide a necessary service and will continue to do so.

I would anticipate, however, that the cost of your flight is going to go up as everything does.

When I first started flying with a civilian helicopter rescue team in 1990, our average bill for a rescue was somewhere in the neighborhood of $1500. When I had to use the same flight team last year to transport me the bill was around $30,000. I'd guess that that is the going rate for all teams nowadays, and as I said, I'd expect it to go up even more with this acquisition and any of Air Methods contracts.

I don't imagine that the need or the service will go away.
I do wonder if they will decide to sell off the assets to AMC's competitors in order to realize a quick profit.

We will see what we will see

Bruce

quote:

Originally posted by RNshooter:
I'm most interested in American Securities and their history with companies that they acquire. How do they make their money? Short term or long term strategies? What do they do with them? Run them or dismantle them and sell off assets?

Based on what I see on their website only, it looks like a little bit of all of the above.

There are more than a few private equity firms whose strategy is to buy companies that are either less-than-optimally managed or in some way not performing up to their potential. The typical course of events is to try to fix their problems via a little bit more "management." If it works, hang on and keep it running, maybe consolidating with another acquisition. If it doesn't, sell it to another PE firm that may not have such high standards.

What this means to the worker bees depends a lot on how close to efficient and amenable to change the previous "corporate culture" was.

I flew for Air Methods on their 206L4 Jet Ranger and as Captain on their S-76 in the early eighties. Life flight is a tough business with expensive equipment and high operating costs.

Roy was the owner back then and a good guy. Some of his senior management were not so good and IMHO caused a lot of strife. They always paid the helicopter pilots less than the fixed wing pilots and the heli pilots carried the company with all the "scene" transports which are dangerous and required a lot of experience to do them safely. I wish them luck as the pool of quality heli pilots is shrinking.

All I can ad is that one of my sons was a flight medic for this outfit out of Raton, NM. The crews were notified I believe it was in early November that the base was shutting down the end of the year. His only options were to reapply for a position in either Albuquerque or Durango.

He already had a three hour drive each direction per shift, moving wasn't an option so no way he would do that. The stories he told me about the issues the company was having just getting the base/crew quarters acquired and organized sounded like a mismanagement nightmare. He did speak very highly of the flight nurses and most of the pilots he worked with.

My son is a current E6 flight medic in the National Guard (almost four years) after ten years as a combat medic with a total of 4 deployments.

He's hoping to get a paramedic position with a fire department but has a very sour opinion of how his little slice of Air Methods was run.