by Staff Writers
Ottawa (UPI) Feb 3, 2013
Canadian aerospace manufacturer Heroux-Devtek Inc. has bought the British and U.S. operations of landing gear company APPH, giving it potentially a larger global market share than it has now.
Heroux-Devtek, which has headquarters in Longueuil, Quebec, already is the world's third-largest manufacturer and supplier of aircraft landing gear. The company said it's paying about $124 million for the purchase.
Heroux-Devtek, which trades on the Toronto Stock Exchange, announced it acquired the entire share capital of U.K.-based APPH Ltd. and U.S.-based APPH Wichita Inc., both subsidiaries of BBA Aviation Plc, which trades on the London Stock Exchange.
APPH is an integrated provider of landing gear and hydraulic systems and assemblies for original equipment manufacturer and aftermarket applications.
With its headquarters in Runcorn in Cheshire, England, APPH is a specialist manufacturer with focus on the design, engineering, production and aftermarket support for landing gear and hydraulic systems and assemblies for fixed and rotary wing civil and military aircraft.
Heroux-Devtek is acquiring four plants located in the United Kingdom and one plant in Wichita, Kan., the Ottawa Citizen reported.
The four plants have a combined workforce of about 400 employees, including a design engineering department with 40 professionals. APPH's main design programs include landing gear systems for the Hawk, SAAB Gripen, AW101, C27J Spartan and EC175 aircraft.
In 2013, APPH generated revenues of about $77 million and adjusted earnings before interest, taxes, depreciation and amortization of about $12.5 million, Heroux-Devtek said in a statement.
The purchase price, net of about $4 million of cash acquired, is about $124 million. The transaction is being financed with the corporation's available cash and existing credit facilities, the company said.
Heroux-Devtek's revenue mix is expected to be about 54 percent military and 46 percent commercial, with about 25 percent of sales originating from proprietary products and 75 percent from built-to-print activities.
Nearly a third of sales should be derived from aftermarket products and services with the rest to be generated by original equipment manufacturers.
"The acquisition of APPH brings significant and immediate strategic benefits to Heroux-Devtek," Gilles Labbe, the company's president and chief executive officer, said.
The purchase would strengthen Heroux-Devtek's global competitive position and status "as a leading landing gear system provider for aircraft weighing less than 100,000 pounds," Labbe said.
The APPH purchase, the company would be able to expand its geographical footprint into the European market, providing it with significant content for several leading programs, increase and diversify its customer base, and open new aftermarket business.
With a majority of its revenues coming from programs where it holds design authority rights on life-cycle mandates, APPH will also provide Heroux-Devtek with an increased proportion of proprietary programs compared with built-to-print activities.
TD Securities acted as exclusive financial adviser to Heroux-Devtek and Lavery, de Billy LLP and Hogan Lovells International LLP acted as legal counsel to Heroux-Devtek.
About 75 percent of Heroux-Devtek's sales are expected to be outside Canada, including 50 percent in the United States. The company has facilities in the Greater Montreal area, Kitchener and Toronto in Canada; Cleveland and Springfield, Ohio, and Wichita, Kan., in the United States; and Runcorn, Nottingham and Bolton in England.
Aerospace News at SpaceMart.com
|The content herein, unless otherwise known to be public domain, are Copyright 1995-2014 - Space Media Network. AFP, UPI and IANS news wire stories are copyright Agence France-Presse, United Press International and Indo-Asia News Service. ESA Portal Reports are copyright European Space Agency. All NASA sourced material is public domain. Additional copyrights may apply in whole or part to other bona fide parties. Advertising does not imply endorsement,agreement or approval of any opinions, statements or information provided by Space Media Network on any Web page published or hosted by Space Media Network. Privacy Statement|