Babcock in negotiations to offload emergency aviation division

Babcock International is reportedly in advanced talks with London-based infrastructure fund Ancala Partners to sell the bulk of its emergency aviation division for £100 million, according to a report by Sky News.

The division, known as Babcock Mission Critical Systems, previously known as Avincis, was acquired by Babcock in May 2014 for £1.6 billion. However, the firm quickly became a significant financial and operational burden for the parent company.

Consequently, the sale of a large portion of the division is expected to crystallize substantial losses for Babcock, despite any potential long-term alleviation of operational costs. However, it is currently unclear what elements of Mission Critical Systems may be sold.

Babcock previously sold its oil and gas helicopter aviation arm for £10 million in September 2021 to CHC Helicopter. The division served offshore oilfields in the UK, Denmark and Australia and employed over 500 people, operating around 30 aircraft.

At the time, Babcock described the divestment of the oil and gas operations as part of a targeted disposal program which aimed to generate proceeds of at least £400million.

Babcock was awarded a four-year contract extension to continue delivering a search and rescue (SAR) service in support of people working in the North Sea in February 2021.