Amazon has acquired a minority stake in Air Transport Services Group, an air freight partner that manages a significant portion of the company’s fast-growing airline logistics unit.
Amazon has exercised warrants in ASTG that will allow it to acquire approximately 13.5 million shares in the cargo airline at an exercise price of $ 9.73 per share, or more than $ 131.9 million, ASTG said in an SEC filing Monday. As part of a separate agreement, Amazon also bought approximately 865,000 shares of ASTG, without exchanging cash, the petitioner said.
Shares in ATSG were up more than 4.9% in early afternoon trading on Monday. Amazon shares have remained largely unmoved.
Amazon has owned warrants in ATSG since 2016. It was granted warrants as part of an agreement to lease 20 Boeing 767s from ATSG, one of the first deals with a freight company to build its fast-growing air fleet. Amazon also owns warrants to purchase a minority stake in rival airline Atlas Air Worldwide Holdings.
Amazon’s air fleet, launched in 2016, is a critical part of its commitment to provide one- and two-day delivery. The company still relies on ASTG and Atlas Air to fly much of its packages, but it has begun to run a number of air freight operations, further adding to the belief that Amazon Air could one day rival FedEx and UPS. becomes credible.
As a first for the company, Amazon purchased 11 used Boeing 767-300 jets from Delta and WestJet in January. Later this year, the company will lift the veil on its $ 1.5 billion air hub in northern Kentucky, which has capacity for 100 Amazon-branded planes and is expected to handle about 200 flights a day.