4
2013 Year in Review
2013 Aerospace M&A Trends
Source: InfoBase; Capital IQ as of 12/31/13
Private Equity Acquisitions by Subsector
37%
6%
12%
18%
9%
18%
Component Supplier
Tooling
Precision Machining
MRO Services
Distributer
Other
Buyer
Target
EV
Protective Coatings, Inc.
NA
SKF - metal rods
$52.0M
Permaswage SA
$600.0M
Exacta Aerospace
NA
Alloy Processing, Inc.
NA
Aerosonic Corporation
$39.0M
Arkwin Industries
$286.0M
Whippany Actuation Systems $150.0M
Airborne Systems
$250.0M
FW Gartner-Thermal Spraying
NA
Exlar Corporation
$85.0M
Phönix Group
$106.0M
Parvus Corporation
$38.0M
Kaydon Corporation
$1,245.7M
Supplier Consolidation
Large OEM suppliers pursued aggressive consolidation efforts in 2013. The most
active buyer was Precision Castparts with five acquisitions targeting lower tier
suppliers, including a $600 million acquisition of Permaswage SA. TransDigm
Group continued to acquire dynamic system and component suppliers, spending
a total of $725 million on four acquisitions. Curtiss-Wright also had four
acquisitions in 2013, spending more than $230 million on companies in a range
of strategic subsectors. The largest consolidation transaction was SKF USA’s
$1.2 billion acquisition of Kaydon Corporation in a move to simultaneously
expand the Swedish industrial giant’s US presence and enhance its engineering
capabilities. Additionally, Triumph Group, RBC Bearings and Astronics all made
three acquisitions during the course of the year.
Expanding Private Equity Presence
Private Equity played an active role in 2013 aerospace M&A, accounting for 27%
of acquirers and 20% of sellers. High commercial aircraft sales combined with
positive forecasts for global air traffic motivated buyers to build or grow positions
in the space despite an average EV/EBITDA multiple of 10.3x. During the year,
Arlington Capital established an engineering solutions platform through its Q1
acquisition of MB Aerospace and subsequent Q2 purchase of Delta Industries.
Resilience Capital Partners also had two acquisitions in a platform build out,
acquiring portfolio company Aerospace Products International in Q1 and Avionics
International Supply in Q4. Greenbriar Equity took EDAC Technologies private in
Q2 and which subsequently acquired Parkway’s Aerospace and Defense
Division in Q3. A majority of the 33 private equity targets were either precision
products suppliers or MRO service providers.
Notable Supplier Consolidation Activity
