Polar’s blue yonder to reach Asia

Polar Air Cargo Worldwide, a subsidiary of Purchase-based Atlas Air Worldwide Holdings, Inc. (AAWW), recently closed on a transaction that gives Florida-based DHL Express a 49 percent equity stake in the scheduled-service air cargo company at a price of $150 million.
The deal with DHL, the world”™s leading express and logistics company, includes a 20-year commercial arrangement that gives the Atlas Air subsidiary a valuable, long-term customer and potential revenue stream in excess of $3.5 billion over the full term of the agreement, AAWW officials said. The arrangement will ensure DHL Express has access to aircraft capacity in key global markets.
DHL Express officials said the agreement will improve service to its customers who ship goods between Asia-Pacific and the U.S. by reducing transit times and increasing reliability of delivery on trans-Pacific air routes.
DHL also acquired a 25 percent voting stake in Polar. Of the $150 million cash payment, $75 million was paid upon closing, with another $75 million to be paid in two installments.
DHL Express will gain access to capacity on six Boeing 747-400 freighters and one 747-200 freighter operated by Polar. The express operator will also have access to additional capacity through leasing of aircraft from another AAWW subsidiary, Atlas Air Inc.
“We are pleased to close on this significant transaction,” said William J. Flynn, president and CEO of AAWW. “We welcome DHL Express as an anchor customer for Polar and the opportunity to be a sizeable supplier of air cargo capacity to a dominant player in the express business. At the same time, we look forward to building on this relationship to meet the demands for future growth on some of the world”™s most important trade routes.”
“Over the past few months, we have planned for the scheduling and staffing to accommodate the high-quality, high-reliability service required in the express business,” Flynn said. “At the same time, we will continue to serve our freight-forwarder customers with convenient schedules on existing routes. In fact, this agreement will add revenue and load certainty to Polar”™s existing network and enhance an already strong presence in key markets.”
John Mullen, global CEO of DHL Express, said the transaction will allow DHL to broaden the scope of  its service offerings “to stay ahead of the curve in view of the increasing demand for cargo routes between Asia-Pacific and the U.S.”