Blog Author

David Jasmund

E: djasmund@pcecompanies.com

Follow me: LinkedIn

Industry Trends

DoD Allocates Billions to Boost National Defense

On March 26, 2024, President Biden signed six fiscal 2024 spending bills, including allocating $824.5 billion to the Department of Defense, averting a government shutdown. The budget, which surpasses fiscal 2023 levels, will fund key initiatives and procurement plans. The highlights of the plan include enhanced equipment funding for the National Guard and substantial allocations for military construction across various states.1

Spotlight on AI for Government Contracting

Following significant growth in 2023, artificial intelligence remains a key focus in the defense industry. Government agencies seek to enhance efficiency with artificial intelligence but must balance this with the Biden Administration's emphasis on safe and ethical implementation. On March 28, 2024, the White House issued updated guidance on AI usage and gave federal agencies until December 1st to implement the binding safeguards.2

Pentagon Advances Cybersecurity and AI for Military Edge

Pentagon officials briefed Congress on initiatives aimed to maintain the U.S. military's technological edge, with a focus on cybersecurity and AI adoption. Efforts include prioritizing secure software, modernizing IT infrastructure, and implementing a zero-trust cybersecurity framework. Highlighted successes include the development of the Combined Joint All-Domain Command and Control (CJADC2) capability, which provides commanders with crucial information across multiple warfighting domains.3

Boeing's 737 MAX Woes Shake Aerospace Industry

Boeings best-selling 737 MAX jet faced scrutiny after a cabin panel tore off an Alaska Airlines jet mid-flight, prompting U.S. regulators to freeze production increases and sending ripples across the aerospace sector. The FAA decision to keep Boeing from expanding production has forced airlines to adjust fleet plans and expansion schedules. Research analysts expressed concerns that the increased regulatory spotlight of Boeing factories might temper production increases for the smaller MAX 8 jet, which is a key cash generator for Boeing.4

American Airlines Bolsters Fleet with Embraer Order

American Airlines ordered 133 aircraft from Embraer to meet domestic demand in the United States. The deal, valued at over $7.0 billion, underscores the airline's commitment to modernizing its fleet with newer, more efficient aircraft. Embraer's E175 is a preferred choice for regional operations, given the jet's record of connectivity and efficiency. American Airlines aims to retire all its 50-seat single-class regional jets by the end of the decade to focus instead on larger dual-class regional jets like the E175.5

Largest Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • Vian Enterprises, Inc.
  • Crane Company
  • $111.00
  • Anillo Industries Inc.
  • Novaria Holdings LLC
  • n/a
  • Miami APU repair station
  • Jets MRO, LLC
  • n/a
  • Airbus Oneweb Satellites LLC
  • Airbus U.S. Space & Defense, Inc.
  • n/a
  • Pilgrim Screw Corporation
  • Meidoh Co.,Ltd.
  • n/a
  • Miles Space, Inc.
  • RocketStar, Inc.
  • n/a
  • BP Aerospace, LLC
  • ITP Aero US
  • n/a

Other Financial Buyer Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • -
  • -
  • n/a

Other Strategic Buyer Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • -
  • -
  • n/a

 

Source S&P Capital IQ as of 4/11/2024 and PCE Proprietary Data

PCE Transactions

Contacts

David Jasmund

Orlando Office

407-621-2111 |

Read More

Michael Rosendahl

New York Office

201-444-6280 Ext 1 |

Read More

Eric Zaleski

Chicago Office

847-239-2466 |

Read More

Data Assumptions

This report represents transaction activity as mergers & acquisitions, consolidations, restructurings and spin-offs. Targets are defined as U.S. Based companies with either foreign or U.S. based buyers. Transaction information provided is based on closed dates only.

Glossary

EBIT - Earnings Before Interest and Taxes
EBITDA - Earnings Before Interest, Taxes, Depreciation, Amortization
LTM - Last Twelve Months
TEV - Total Enterprise Value

Sources:

  1. 1. Goheen, John. “DoD Finally Has a Fiscal 2024 Spending Plan.” The National Guard Association of the United States, March 26, 2024.
  2. 2. Sentient Digital, Inc. “2024 trends in government contracting you need to know, from a government contractor.” Sentient Digital News, February 27, 2024.
  3. 3. Clark, Joseph. "Pentagon Technology Officials Focus on Maintaining U.S. Edge." DOD News, March 22, 2024.
  4. 4. Singh, Rajesh. "Boeing's MAX production issues ripple across aerospace industry." Reuters, January 24, 2024.
  5. 5. Embraer. “American Airlines Places Order for up to 133 Embraer Aircraft.” Embraer, March 4, 2024.
contact usan image