US airport agent AGI plans South America expansion

MIAMI — Alliance Ground International (AGI), a fast-growing airport services company focused on cargo, plans to start looking for international expansion opportunities in South America later this year, said CEO Jared Azcuy.

The ground handling agent last year entered the Canada market through the acquisition of Airport Terminal Services and announced its intent to add passenger and cargo operations in Europe.

AGI’s strategy is to build a global network of airports that matches those of key airline customers, based on the premise that airlines can benefit from more consistent service by dealing with a single provider instead of different local vendors at every location. The concept is similar to how several ocean terminal operators have acquired port assets around the world to provide added value to shipping lines.

“Our next phase of growth is really the European market. Our objective is to grow cargo. It’s a cargo-first growth strategy,” Azcuy told FreightWaves last week between customer meetings at the Cargo Network Services conference here. “We’re really chasing cargo nodes. And we are close to launching our South American strategy as well.”

AGI is “far along” in its search for a European takeover target after hiring Olivier Bijaoui, the former head of rival Worldwide Flight Services, as a deal adviser last September.

The Miami-based company currently operates in 63 locations in North America and has about 12,000 employees. The most recent stations added are at Cincinnati/Northern Kentucky International Airport, where British Airways selected the company to handle cargo carried on its new passenger service from London, and at Birmingham-Shuttlesworth International Airport in Alabama, where AGI is supporting the first freighter service. 

An AGI subsidiary, Cargo Force, processes airmail for the U.S. Postal Service.

Ground handling consolidation

Airport ground handlers are competing to gain scale through consolidation. AGI is trying to break into a small club of global airport service companies led by Menzies Aviation, Swissport and Worldwide Flight Services, which was acquired last year by Singapore-based SATS Group. Menzies was also bought by Kuwait-based supply chain management company Agility. A 2020 financial restructuring transferred ownership of Swissport to a group of prominent hedge funds, including Apollo Global Management. 

The three mega-handlers each provide airport service at more than 200 airports.

Menzies in May acquired Aircraft Services and Consulting S.A., an airport operator in Panama.

AGI, which is owned by investment firms Audax Private Equity and Greenbriar Equity Group, last summer purchased Total Airport Services, in addition to Airport Terminal Services. And in 2021 it expanded its presence at Chicago O’Hare airport with the acquisition of local cargo agent MIC Cargo. The 2022 deals got AGI into the passenger business for the first time.

Azcuy said having full passenger and cargo capability makes the company more attractive to stakeholders within the airport ecosystem and gives the company more flexibility because it can share labor and equipment where it is needed most. When Hartsfield-Jackson Atlanta International Airport recently requested urgent ramp and passenger services for a new Ethiopian Airlines flight, for example, AGI was able to start operations within 16 days — a process that normally takes three months — because it could temporarily peel off some of its cargo workforce for the new contract. 

“It seems to me that the cargo handler of the future has to do both in order to service the airport and be a valuable member of the airport operations team,” he said in the company’s private meeting room at the JW Marriott Miami Turnberry Resort.

AGI picked up eight locations with the takeover of Total Airport Services (TAS), including another terminal at Chicago O’Hare and at cargo-only Rickenbacker International Airport in Columbus, Ohio. The ground handler consolidated Rickenbacker operations there in the TAS building because it is adjacent to the airfield and got rid of the warehouse from the earlier MIC Cargo deal because it was located outside the airport fence, which required cargo to be shuttled there by truck.

Azcuy expressed optimism that the 15-month slump in air cargo volumes will begin to lift in the third quarter, based on extensive consultations with airlines and freight forwarders. 

“From every source we talk to, it seems like this will be a better peak season than last year,” he said.

Click here for more FreightWaves stories by Eric Kulisch.

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Editor: Eric Kulisch