June 18, 2019 Update

M&A Deal Spotlight: AIM Aerospace

Liberty Hall to Sell Portfolio Company AIM Aerospace to Japan’s Sekisui Chemical Co.

AIM is a Renton, WA-based designer and producer of advanced composite structures, systems, engine components and thermoplastic technology for the global aerospace industry. The company has more than 1,000 employees operating from its manufacturing centers of excellence and research and technology center located in the United States. AIM was originally founded in 1988 as part of the UK-based AIM Group PLC, then acquired by Liberty Hall in 2016 to serve as the foundational asset of the firm’s strategy to build a fully-integrated, diversified composites supplier. In 2017, Liberty Hall acquired Quatro Composites, a supplier of highly engineered advanced composite structures, components and assemblies, and integrated the company into AIM Aerospace. AIM’s key customers include The Boeing Company, GE, Kawasaki Heavy Industries and Spirit AeroSystems. Rowan Taylor, founder and managing partner of Liberty Hall commented, “As demand for composite components continues to increase, we are pleased that AIM Aerospace is well-positioned to deliver a new generation of complex products to the industry. We are very proud to transfer leadership to Sekisui to oversee the next chapter in AIM Aerospace’s expansion.” AIM was originally acquired in 2016 by Liberty Hall for a purchase price of $220mm and sold to Sekisui for $510mm.

M&A

AeroVironment, Inc. Acquires Pulse Aerospace, LLC

Lawrence, Kansas-based Pulse Aerospace, LLC is a developer of small VTOL UAS technology. Pulse’s HeliSynth™ technology brings flight control, payload, and endurance capabilities to market at attractive price points for both defense and commercial end markets. Pulse recently received a multi-year contract award with a maximum value of more than $13 million from an undisclosed defense customer for its Vapor unmanned VTOL systems, spares and services.

CGI, Inc. to Acquire SCISYS Group plc

Chippenham, Wiltshire, UK-based SCISYS Group plc is a developer of information and communications technology (ICT) services, e-business, web and mobile applications, editorial newsroom and advanced technology solutions. The company operates in markets including media & broadcast, space, government & defense and commerce.

DLH Holdings Corp. Acquires Social & Scientific Systems, Inc.

Silver Spring, Md.-based Social & Scientific Systems, Inc. (‘SSS’) is a public health service organization providing solutions in clinical and biomedical research, epidemiology, health policy, and program evaluation. SSS utilizes advanced research (including longitudinal studies), data analytics, and secure IT platform services to assist mission-critical public health agencies within the Department of Health & Human Services—including the National Institutes of Health (NIH) and the Centers for Medicare and Medicaid Services (CMS)—along with other healthcare-related institutions. The company, with approximately 400 employees, has offices in Durham, NC and Kampala, Uganda and was founded in 1978.

EMCORE Corp. Acquires Resilience Capital Partners, LLC Portfolio Company Systron Donner Inertial, Inc.

Concord, Calif.-based Systron Donner is a supplier of quartz microelectromechanical systems (QMEMS) used in inertial sensing products that provide precision guidance, navigation and locational solutions. The company develops products that have been used in everything from business aircraft to fighter jets to the MARS Rover. Founded in 1953, Systron Donner’s QMEMS technologies are used in gyroscopes, accelerometers, inertial measurement units and inertial navigation system/GPS products that provide highly precise and reliable stabilization, geo-location, guidance, navigation and flight control solutions for aerospace, marine and land vehicles and systems.

EMK Capital Acquires Covidence A/S From Montagu Private Equity

Denmark-based Covidence A/S provider of high-end, miniature video and audio surveillance solutions for government-approved federal, military, and law enforcement organizations worldwide. Covidence, founded by Jimmi M. Hansen (CEO) and Henrik Klebaek, is a specialist electronics manufacturer with a niche focus on miniature covert video surveillance equipment, used by police, intelligence agencies, special forces and other government approved organizations. The company, which has a global customer base, with close relationships to many of the world’s federal agencies, was founded in 2007.

IIA Technologies Corp. Acquires KeyLogic Systems, Inc.

Morgantown, W.V.-based KeyLogic is a provider of systems engineering and professional services to the public and private sectors. Founded in 1999, the company’s capabilities include enterprise solutions, business intelligence, data analysis, research and development program management, software and system engineering, and biometric solutions. The merger of IIA and KeyLogic establishes a new mid-tier technology specialist with over 600 data scientists, developers, engineers, researchers, and analysts leveraging big data analytics, cloud computing, network and cloud telemetry, machine learning, high performance computing, and cyber analytics to solve government’s business problems quicker with high-impact outcomes. KeyLogic also complements IIA with 40+ additional PhD-level subject matter experts.

Jacobs Engineering Group, Inc. Completes Acquisition of KeyW Corp.

Hanover, Md.-based KeyW Corp. is a national security provider of advanced engineering and technology solutions to the Intelligence, Cyber and Counterterrorism communities, with ‘unique and differentiated’ capabilities in the areas of intelligence, surveillance and reconnaissance (ISR); cyber operations and training; and mission-critical IT and analytics. KeyW’s advanced engineering and quick reaction capability supports the accelerated development of collection technology, processing, analysis and dissemination of information across the full spectrum of missions for the Intelligence, Cyber and Counter terrorism communities. The company’s workforce solves complex customer challenges such as preventing cyber threats, transforming data to actionable intelligence, and building and deploying sensor packages into any domain.

Rolls-Royce plc Contirms Preliminary Discussions to Sell Subsidiary ITP Aero to Indra Sistemas S.A.

Zamudio, Spain-based Industria de Turbo Propulsores S.A. (ITP) designs, develops, manufactures and maintains gas turbine engines used in aerospace (both fixed-wing and rotary-wing), naval, energy generation and other industrial applications.

TPC Wire & Cable Corp. Acquires EZ Form Cable Corp.

Hamden, Conn.-based EZ Form Cable Corp. is an AS9100D Certified provider of coaxial RF & microwave interconnect products for specialized applications common in defense, space, wireless communications and medical instrumentation.

INDUSTRY NEWS

Boeing 737 MAX: 200-Aircraft IAG Deal at Paris Air Show

On June 18 there was an announcement of a tentative deal between Boeing and International Airlines Group (IAG) for 200 737 MAX. The companies said they signed the letter of intent (LOI) at the show. The LOI splits the orders between the MAX 8 and MAX 10 variants. It also is a major blow to Airbus, which is the sole narrowbody aircraft supplier to IAG’s airlines.

Russian Helicopters at Paris Air Show

This year, Russian Helicopters Company is showing Ansat light twins in VIP and medevac configurations. The former will take part in flying display while the latter can be seen only at the static.

Amazon Unveils Delivery Drone Design

June 5 – Amazon revealed its latest design for a delivery drone, rolling out a shrouded, multi-rotor aircraft capable of vertical and wing-borne flight. Amazon unveiled its design at the company’s annual, invitation-only MARS (Machine learning, Automation, Robotics and Space) Conference in Las Vegas. 

Regional Jets At The Paris Air Show

Embraer’s E195 E-2 ‘Profit Hunter’ arrived at this year’s Paris Air Show, though a new name is possible as Boeing JV is in the works. Mitsubishi’s rebranded MRJ, the SpaceJet will also be displayed at the show.

Rolls-Royce Acquires Siemens’ eAircraft Business

Rolls-Royce has agreed to acquired Siemens’ electric and hybrid-electric aerospace propulsion activities. The transaction is set to be completed in late 2019. Siemens’ eAircraft business employs around 180 electrical designers and engineers across locations in Germany and Hungary. Based in Germany and Hungary, Siemens’ eAircraft business has been developing all-electric and hybrid electric propulsion systems for aircraft such as Eviation’s Alice nine-seater commuter aircraft and the E-Fan X hybrid electric demonstrator with Airbus and Roll-Royce. Under the acquisition, the company’s electric propulsion design team of 180 specialists will be integrated into Rolls-Royce’s recently created electrification unit. Rolls-Royce sees the acquisition as a chance to quickly augment its own developments in the sector, but also to penetrate new markets ranging from electric vertical take-off and landing (eVTOL) vehicles to regional airliners. 

Airbus Collects More A321XLR, A330neo Orders

Cebu Pacific: placed an order for 16 A330-900s and ten A321XLRs, the longest range version of the A321neo. The carrier will be the highest-density operator of the A330neo.
International Airlines Group (IAG): agreed to a firm order for 14 A321XLRs. The company will place eight of the aircraft with its subsidiary Iberia, six will fly for Aer Lingus. None are going to low-cost operator Level. Airbus said the aircraft will enable Aer Lingus to launch new routes beyond the U.S. East Coast and into Canada. Iberia plans to operate to new transatlantic destinations and increase frequencies in existing markets. Saudi Arabian Airlines: increased its A320neo family order from 35 to 65 aircraft. 15 of the additional aircraft are of the new A321XLR variant. Saudia is expanding capacity fast partly as it takes advantage of the new terminal at Jeddah International Airport. Air Asia: converted an order for 253 A320neos to the larger A321neo. It now holds firm commitments for 353 of the aircraft turning the airline into the model’s biggest customer. 

Pratt & Whitney Orders at the Paris Air Show

Delta Airlines has added five A220-100s to its existing order of 90 of the type, increases the total P&W GTF sales announced at the Air Show to 297. JetSMART, and will see 85 A320neos powered by GTF engines. The first delivery is expected in the third quarter of this year. The second-largest portion of the overall number comes from a combined announcement of 74 sales to two airlines and one lessor in China. The identities of the end users were not revealed by P&W. Mexico-headquartered airline VivaAerobus, which selected the GTF for its firm order of 41 A320neos. This order includes 25 new aircraft and 16 conversions of a 2013 firm order. SMBC Aviation has selected the GTF in an additional order of 20 A320neo family aircraft. The order brings the lessor’s total order for GTF-powered A320s to 50. The additional aircraft are expected to be delivered by 2025. And Middle East Airlines has selected the GTF for its order of four A321XLRs, which are conversions of a 2018 firm order. An undisclosed lessor has selected the engine for 35 firm orders and a further five options, while another order from an undisclosed airline will see 28 A320neos equipped with GTF engines.

Raytheon Missile Systems and Northrup Innovation Systems Partner to Develop Scramet Missile

Raytheon Missile Systems and Northrop Grumman Innovation Systems announced a partnership at the Paris Air Show on June 18 to co-develop a scramjet-powered hypersonic missile. 
The team will develop an advanced new high-speed weapon system as one of two competitors for the High-speed Air-breathing Weapon Concept (HAWC) funded by the Defense Advanced Research Projects Agency. Lockheed Martin also is developing a scramjet-powered missile for the HAWC program.