AEROSPACE and defence group Meggitt is to boost its presence in the United States with a new acquisition.
The group, which includes Coventry-based Meggitt Aircraft Braking Systems (MABS), is set to takeover civil and military aerospace firm Pacific Scientific Aerospace in a deal worth £440m ($685m) from Danaher Corporation.
The acquisition will be funded in part by an equity placing of up to 69.8m new ordinary shares, representing less than 10% of Meggitt’s current issued share capital; the balance will be funded from existing debt facilities.
PSA is a leading supplier of components to the global civil aerospace and military markets. Organised in six businesses, PSA offers fire suppression, sensing, electric power, electric actuation and security products, with a balanced presence between civil aerospace (57% of revenues) and military (43% of revenues) markets.
Meggitt said PSA represented a good fit with its business model, with strong technology positions, a significant level of sole source content and aftermarket sales representing more than one-third of PSA’s total revenues.
The acquisition will increase Meggitt’s shipset values on major civil and military platforms, including key growth platforms such as the Boeing 787, Airbus A380, A350 and A400M and Eurocopter NH-90.
Terry Twigger, chief executive of Meggitt, said: “The acquisition of PSA represents a further major step in the strategic growth and development of the Meggitt Group and fits well into Meggitt’s business model, with strong technology positions, a significant level of sole source content and aftermarket sales representing over one-third of PSA’s total revenues.
“The acquisition adds fire and smoke suppression capabilities to Meggitt’s product portfolio, creating an integrated leading fire and smoke detection and suppression offering, it increases Meggitt’s shipset values on major civil and military platforms (including key growth platforms such as the Boeing 787, Airbus A380, A350 and A400M and Eurocopter NH-90), and will enhance Meggitt’s offering of electric aircraft solutions as aircraft of the future shift away from hydraulic / pneumatic technology towards electric power.”
Meggitt, which announces its full year results on March 1, said it continued to trade in line with the board’s expectations.
The group received financial advice from Rothschild in relation to the acquisition. BofA Merrill Lynch is acting as corporate broker for the company.
