News Release

Gama Aviation Plc acquires of 51% of Gama Group Mena FZC

Gama Aviation today announced the acquisition of the 51% Jet Set interest in Gama MENA for a cash consideration of $5.1m. Following the acquisition, the company will own 100% of Gama MENA.

Consistent with worldwide regulations governing the foreign ownership of air carriers nationally, Gama MENA has divested a 51% equity interest in Gama Aviation FZE, its ME Air Division, to Felix for a nominal consideration. Under an agreement between shareholders, Gama MENA will retain management and operational control of the ME Air Division and will be entitled to 80% of the dividends paid by Gama Aviation FZE. In addition, Gama MENA will receive a branding fee of 0.5% of the revenues of Gama Aviation FZE.

As part of the original Jet Set Equity Partners Limited (FZC) investment into Gama Aviation in 2008, Gama Aviation and Jet Set agreed to establish a start-up operation in the Middle East to provide air and ground services regionally. Jet Set is a consortium of local private equity investors comprising Growthgate Capital Corporation BSC (C) Bahrain, Crescent Investment LLC and Felix Tr. Co. LLC each of whom is currently a share holder of the company. Under the terms of this original investment, a regional holding company for the Air and Ground divisions, Gama Group MENA FZC was formed with the company holding a 49% equity interest and Jet Set owning the remaining 51%. Gama Group MENA FZC provides aircraft management and chartering through its subsidiary Gama Aviation FZE (the ME Air division) and aircraft maintenance and FBO services through its Gama Support Services FZE subsidiary (the ME Ground division).

In the year ended 31 December 2016, Gama MENA achieved revenues of $24.7m and profit before tax of $0.2m. Gama Aviation believes that there are significant growth opportunities in the Middle East generally. In particular, new compliance requirements in Saudi Arabia and the development of the business aviation centre in Sharjah, UAE, present attractive aircraft management opportunities which are also expected to drive growth in maintenance and FBO services. Gama Aviation has therefore decided to increase its economic interest and management control in Gama MENA at a time when the business is well placed to grow and develop this market opportunity.

This transaction between Gama Aviation and Jet Set is considered to be a related party transaction for the purposes of AIM Rule 13, and accordingly the Board, having consulted with Jefferies International, the Company's nominated adviser, considers the terms of the transaction to be fair and reasonable insofar as the company's shareholders are concerned.

This announcement contains inside information