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Please view our Full Q3 Report Here.

Dear Friends,

Hope you are well. As the general economy and other aspects of everyday life slowly start to
begin to ease towards normalcy (depending on where you are); the M&A market has
orientated itself to a post-Covid reality and has entered into a full-blown “V-Shaped
Recovery.” While that dynamic is very end-market and situation specific, we have seen
private equity and their lending partners revitalized and back into (remote) deal making
mode.

As amazing as that buy-side dynamic may seem to outside observers, the supply of
transactions has increased significantly and is close to approximating 2019 levels. While
some of the M&A activity is opportunistic, we have observed a far greater proportion of the
selling coming from family or owner-operated businesses that are seizing the opportunity to
transact ahead of any potential changes in capital gains tax treatment. Both with our
clientele and anecdotally, we have heard multiple examples of private sellers accelerating
their time horizons to prevent potential tax leakage.

For our practice, we are pleased to announce the close of Geodetics to Aevex Aerospace, a
portfolio company of Madison Dearborn Partners. The sale of Geodetics checked many
boxes for potential buyers including proprietary defense electronic products, national
security and clandestine, military customers as well as playing into specific micro trends
around operating in GPS-denied environments. We expect Q4 2020 to be our busiest to
date as we have multiple transactions that we are excited to share.

In this Quarterly Industry review, we will continue to assess the ongoing carnage in
commercial aerospace. While recent deliveries and orders do not point to near-term
recovery, we are hopeful that the upcoming quarter will finally mark a return to service for
the B737MAX and a continuation of the gradual improvement in load factors and passenger
miles. Even in this part of the market, there are multiple high-quality commercial aerospace
businesses in the market that are seeing strong demand for a wide-range of buyers.
Additionally, with the election forefront on everyone’s minds, we attempt to remind
everyone that changes in defense spending tend to be more gradual (regardless of
Administration) than partisan voices account for.

As always, please feel free to reach out to either of us with any questions.

Sincerely,

Trevor Bohn & Ryan Murphy