Osborne Clarke advises on rescue deal to keep critical air ambulances flying

Osborne Clarke has advised Specialist Aviation Services Limited (SAS), and its joint administrators from FRP Advisory, on a complex sale of the aviation provider's business, maintaining continuity for air ambulance services across the South of England.

Headquartered at Gloucestershire Airport, SAS provided critical helicopter emergency medical (HEMS) and maintenance services to multiple air ambulance charities across the South of England, including across, Kent, Surrey, Sussex, Dorset, Somerset, Essex, Hertfordshire and London. In total, SAS supported more than 5,000 air ambulance flights in 2023.

Following a review of its options in light of its financial difficulties, SAS instructed specialist advisory firm FRP Advisory and Osborne Clarke to run an accelerated M&A process in October 2023, with a strategic priority of finding a solution that facilitated the continuation of vital air ambulance operations without disruption. The complex regulatory framework surrounding SAS's operations required engagement with a number of key stakeholders, including the Civil Aviation Authority, the air ambulance charities, global OEM providers and specialist financiers.

On 31 January 2024, Andrew Sheridan and Jonathan Dunn of FRP Advisory were appointed as joint administrators of SAS, whose business and assets were then immediately sold to global aviation provider, Gama Aviation. The sale not only ensured continuity of service for air ambulance charities across the South of English, but it also ensured continuity for 182 SAS employees.

The Osborne Clarke team advising on contingency options and the complex sale process was led by restructuring partner Nigel Boobier, with colleagues Sam Furse and Claire Bundy taking key roles. Supporting the transaction included a multi-disciplinary team, including Anna Perry, Aaron Ewart, Simon Hancock, David North, Douglas Peden, Jamie Halpin and Marc Shrimpling.

Andrew Sheridan, one of the joint administrators of SAS, said:

"This was a complex transaction, in the heavily regulated aviation sector, and key parties included aircraft financiers, global OEMs, overseas government contracts and of course the air ambulance charities. Without the support of the CAA who mobilised a senior team and worked at speed this transaction could not have happened and we wish to extend our gratitude to them, as well as to the Company’s senior management team.

“The goal from the outset of our involvement was to ensure that the vital air ambulance operations continued without disruption, which they did. We take great satisfaction in ensuring that lives continued to be saved throughout the process and wish Gama and its newly acquired operations, highly skilled operatives and pilots, every success in the future.”

Nigel Boobier, lead transaction partner at Osborne Clarke, said:

"There are also important lessons for all companies with complex and international supply chains, especially with mounting economic and political instability'. It's important to undertake contingency planning to check on the continuity of supply, maintain resilience, and to consider alternative suppliers or arrangements in the event of distress. It's key is to understand the legal levers available and to appreciate the commercial dynamics, especially if new terms need to be negotiated or alternative funding needs to be provided to ensure continuity."

Other advisers included Gordon Brothers (valuation), Pinsent Masons (director advisers), Stevens & Bolton (acting for Gama), BCLP, Brodies and Norton Rose Fulbright (acting for other key stakeholders).

With global supply chains currently facing enormous pressures, including from the war in Ukraine, global shortage of materials, and disruption to shipping in the Red Sea, the impact of distressed supply chains is being felt far and wide across all sectors, on both supplier and customer sides. Osborne Clarke provides a full range of legal services to help deal with all aspects of the supply chain, including insolvency, and advises on actions businesses can take to mitigate risks and avoid costly disputes. These challenges are now recognised by the Government with the issuing of a UK critical imports and supply chains strategy in January 2024 UK critical imports and supply chains strategy - GOV.UK (www.gov.uk).