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David Jasmund

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Industry Trends

Navy Awards $6.75B Contract to General Dynamics

General Dynamics NASSCO has secured a $6.75 billion contract to build eight T-AO 205 John Lewis-class fleet replenishment oilers for the U.S. Navy, with work expected to continue through 2035. The Navy aims to save $491 million through a block-buy approach, with construction underway on several ships. The scale and technical demands of these projects require specialized capabilities from companies of all sizes, ensuring broad participation across the supply chain.1

Honeywell Adds $1.9B to Defense Portfolio

Honeywell announced the completion of its $1.9 billion acquisition of CAES, bolstering its defense and space portfolio with key technologies across multiple military platforms. This marks Honeywell's fourth acquisition in 2024, including its recent purchase of Air Products' LNG process technology. With U.S. LNG exports expected to rise significantly, Honeywell’s acquisitions highlight both its aggressive growth strategy and the broader industry's increasing focus on energy transition and defense capabilities.2 3

HII Wins $209M Air Force Contract

HII has secured a $209 million contract to enhance the readiness of the U.S. Air Force’s fighter and bomber aircraft. With up to 514 aircraft expected to be grounded at any time due to a lack of spare parts, this five-year project, spanning multiple Air Logistics Complexes, offers a range of opportunities for specialized suppliers and service providers to engage in long-term sustainment efforts, ensuring the continued availability of mission-critical aircraft.4

Boeing Acquires Spirit Amid Turmoil

Boeing’s recent $4.7 billion acquisition of Spirit AeroSystems, finalized on July 1, 2024, aims to stabilize its supply chain. However, leadership changes, including a new CEO, the defense chief’s departure, and union strikes halting 737 production continue to pressure the company. Boeing’s struggles may ripple through the supply chain despite strong aerospace demand, delaying deliveries industry-wide.5 6

Record Aircraft Demand Strains Aerospace Amid 15,000-Order Backlog

With global air traffic exceeding pre-pandemic levels and demand for new aircraft at an all-time high, the commercial aerospace industry faces a backlog of over 15,000 orders—equivalent to more than nine years of production. Supply chain disruptions and labor shortages slow this $1.3 trillion opportunity, but it opens the door for manufacturers to step in and relieve bottlenecks, positioning themselves as essential partners in an expanding market.7

Largest Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • Cobham Advanced Electronic Solutions Inc.
  • Honeywell International Inc.
  • $1,900.00
  • Raptor Scientific LLC
  • TransDigm Group Incorporated
  • $655.00
  • kSARIA Corporation
  • ITT Inc.
  • $475.00
  • BlackSignal Technologies, LLC
  • Parsons Corporation
  • $200.00
  • Astra Space, Inc.
  • Undisclosed
  • $87.00

Other Financial Buyer Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • Alpha Metalcraft Group
  • IGP Industries LLC
  • n/a
  • Certified Aviation Services, LLC
  • Undisclosed
  • n/a

Other Strategic Buyer Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • Aero Turbine, Inc.
  • StandardAero, Inc.
  • n/a
  • Reiff Preheat Systems
  • Hartzell Propeller Inc.
  • n/a

 

Source S&P Capital IQ as of 10/10/2024 and PCE Proprietary Data

PCE Transactions

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David Jasmund

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Michael Rosendahl

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Eric Zaleski

Chicago Office

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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. Edwards, Jane. “General Dynamics NASSCO Awarded $6.8B Navy Contract for 8 Replenishment Oilers.” GovConWire, September 16, 2024.
  2. 2. Honeywell. "Honeywell Completes Acquisition of CAES." Honeywell, September 4, 2024.
  3. 3. Reuters. "Honeywell to Buy Air Products' LNG Unit for $1.81 bln as Deal-Making Spree Continues." Reuters, July 10, 2024.
  4. 4. Montalbano, Vanessa. “Air Force, HII Pen $209 Million Deal to Support Fighter and Bomber Sustainment.” Inside Defense, August 12, 2024.
  5. 5. Terlep, Sharon. "Boeing Machinist Strike Adds Cash Crunch to New CEO’s Rescue Mission." The Wall Street Journal, September 15, 2024.
  6. 6. Terlep, Sharon. "Boeing Defense Chief Exits Company." The Wall Street Journal, September 20, 2024.
  7. 7. Brooks, B; et al. "Aerospace & Defense Players Face Historic Backlog in Highly Disruptive Environment. Addressing Key Issues – Ranging from Supply Chain to Sustainability – Critical to Accelerating Ramp-up, AlixPartners Study Says." Alix Partners, July 9, 2024.
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