Dnata eyes acquisition opportunities

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Dubai-based airport ground handling specialist Dnata is looking to further expansion opportunities, both through organic growth and acquisitions, as it rolls out a rebranding of its UK and Singapore divisions.

The UK business, Plane Handling, was acquired in late 2009 from Go-Ahead Group and has more than 1,800 employees working at London Heathrow and Manchester airports where it provides cargo, ramp, and passenger handling services to 30 airlines. Plane Handling has just assumed the Dnata identity as part of a rebranding effort which is also being applied to the Emirates group company's Singapore division Changi International Airport Services from August.

The company expects to turn over Dhs6 billion ($1.6 billion) this year, and Dnata President Gary Chapman said the business has quadrupled in size over the last six years through acquisitions and organic growth. "We'll be looking at 10-15% compound growth going forward," he said.

Dnata, which is the sole ground handler at its main base in Dubai, also has businesses in Australia, China, Iraq, the Philippines, Pakistan, and Switzerland and employs 20,000 people worldwide.

Chapman said he sees growth in the UK and internationally being achieved "both organically and we'll keep an eye on opportunities", adding that Dnata is currently looking at an acquisition in the catering sector.

"We're getting approaches quite often, but we've got to be comfortable with the working environment," he said.

Pointing to the likelihood that French-based global ground handler WFS will come on to the market, Chapman said that "one of the problems is that generally the expectations in terms of what they expect to be paid will be rich".

He added that the Latin American market "could also be an opportunity" for growth.

Meanwhile, Dnata and LSG Sky Chefs are awaiting approval from European Union competition watchdogs to merge the UK ground handling business of Dnata-owned Alpha Flight with the German company's UK operation, to create a 50/50 joint venture. "You can put emotion aside and look at the pure business benefits," said Chapman, acknowledging that Dnata's sister company Emirates Airline is a major competitor with LSG parent Lufthansa.