Apollo Global in Talks to Acquire Atlas Air Worldwide

This is why Apollo Global wants Atlas Air (5Y), operator of the world's largest fleet of Boeing 747 freighters.



August 2, 2022

DALLAS - A group led by Apollo Global Management is in advanced talks to buy cargo airline Atlas Air Worldwide (5Y), operator of the world's largest fleet of Boeing 747 freighters.

Atlas Air's shares went up by 13.9% on Monday after the Wall Street Journal reported on the talks. If negotiations move forward, a deal may be reached soon, according to WSJ, which made no mention of the terms of the deal.

According to seekingalpha.com, the cargo airline announced better-than-anticipated Q1 adjusted earnings of US$2.99/share on more than US$1B in revenues.

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Atlas Air N412MC Boeing 747-400F(SCD). Photo: John Leivaditis/Airways

"The Savior of Aviation"

The aviation industry's freight segment has grown more than any other over the previous 12 months. After growth during the pandemic, freight was praised as the "star of the show" at the GHI Conference last year.

Since the effects of the COVID limits began to be felt by the rest of the industry, it has been said that this sector, driven by the increase in eCommerce demand, has been "the savior of aviation."

The general consensus is that this industry sector has a unique chance to not only welcome this spike in activity but also streamline processes and procedures to optimize it because it shows no indications of slowing down. It seems Apollo Global knows this.

Atlas Air Boeing 747-400(F). Photo: John Leivaditis/Airways

Cargo Demand in 2022

The International Air Transport Association (IATA) reports that economic conditions suggest that the high cargo demand that persisted throughout last year is likely to continue in 2022. Despite reports indicating that demand is still below pre-pandemic levels for 2019, data for the third quarter of 2021 clearly indicated a month-over-month increase of 8 to 9%.

The change in demand for eCommerce has been one of the most important driving forces. According to a-ice.aero, experts in the field have drawn attention to this, and two compelling and intriguing forecasts have emerged:

  • eCommerce is expected to represent 20% of global air cargo in 2022
  • Amazon Air will swell its’ fleet to 200 aircraft over the next five years (from 80 in 2021)

Featured image: Atlas Air Boeing 747-400. Photo: Mateo Skinner/Airways