flynas takes 10% holding in Swissport Saudi Arabia

Saudi low-cost carrier flynas has agreed to acquire a 10 per cent stake in Swissport Saudi Arabia for about SAR50 million, pairing the investment with a five-year exclusive ground-handling agreement covering its network across the kingdom.

The transaction, signed on September 6 and disclosed to the Saudi Exchange on Monday, also gives flynas an option to buy an additional 10 per cent of Swissport Saudi Arabia when the handling agreement is renewed. Completion of the share purchase remains subject to customary conditions and approvals from the General Authority of Civil Aviation and the General Authority for Competition.

Swissport Saudi Arabia will begin providing ground-handling services to flynas on March 6, 2027, under an agreement running until March 5, 2032. The contract can be extended for another five years by mutual agreement, at which point flynas would be entitled to exercise its option to raise its holding to 20 per cent.

flynas said the equity purchase will be financed from internal resources. The sellers are Swissport International AG and Asyad Holding, the current shareholders of Swissport Saudi Arabia. Beyond the fixed purchase price of $13.33 million, the agreement provides for a minimal variable equity payment calculated under a formula set out in the transaction documents.

The ownership element gives flynas a direct financial interest in the company that will handle its flights, while leaving Swissport and Asyad Holding as the other shareholders after completion. The structure links any further increase in flynas’ stake to renewal of the services contract, tying the option to continuation of the operating relationship rather than providing an immediate path to a larger holding after five years.

The airline also said expected annual purchases under the new ground-handling agreement would amount to about 5 per cent of its revenue as reported in its audited financial statements for 2025. The arrangement covers services at all commercial airports in Saudi Arabia and will make Swissport the airline’s exclusive ground handler in the domestic market once the contract takes effect.

The move will replace Saudi Ground Services Company, flynas’ existing provider. flynas issued a termination notice on September 6, with the current agreement ending on March 5, 2027 after the required six-month notice period. Saudi Ground Services said it would continue serving flynas normally until then.

Saudi Ground Services said the flynas contract generated SAR151.47 million in revenue during the first half of 2026 and was expected to produce about SAR306 million for the full year. It said the termination would have no financial effect on its results for 2026 because services will continue through the notice period, while the revenue impact will begin from March 6, 2027.

The ground-handling company said it would seek to improve productivity and optimise expenses to mitigate the impact after the contract ends. Its shares fell sharply during Monday’s trading following disclosure of the termination, while the wider Saudi market was also under pressure.

For Swissport, the agreement expands both its commercial relationship with flynas and its position in Saudi airport services. The company said the deal would lift its share of the Saudi ground-handling market to about 40 per cent. Swissport provides passenger handling, ground management and supervision, surface transport, cargo and baggage services and other airport support activities.

Warwick Brady, president and chief executive of Swissport International, said the partnership would strengthen the group’s scale and competitive position in Saudi Arabia and support flynas’ expansion. He said Swissport’s experience in safety, operations, technology and workforce development would underpin the enlarged relationship.

Bander Almohanna, chief executive and managing director of flynas, said taking an equity stake reflected the airline’s intention to build a deeper strategic relationship with Swissport rather than retain a conventional supplier arrangement. He said the choice aligned with flynas’ long-term growth plans and Swissport’s operational and technological capabilities.