Aerospace and Defense Update: Fourth Quarter 2011
Deloitte Corporate Finance LLC
This quarter’s Aerospace & Defense Update, produced by Deloitte Corporate Finance LLC (DCF), summarizes the most recent transactions within this industry along with information on the most active buyers, current transaction valuation multiples and an overview of the public market’s perception of the industry.
- Aerospace & Defense (“A&D”) mergers and acquisitions (“M&A”) activity in 2011 was down slightly from 2010 (8%) in terms of M&A deal volume but aligned with the overall level of activity we have witnessed over the past five years, excluding the uniquely challenging environment seen in 2009.
- While the commercial aircraft industry had a record year in 2011 in production and a near record year in orders to replenish robust backlogs, the defense sector is increasingly subject to budget constraints and heightened competitions for large programs of record in both the U.S. and Europe.
- Overall divestiture volume increased by 6% and was 25% of total deal volume during the year. The principal areas for divestiture by volume were aerospace at 41% and defense at 38%.
- The last two years have seen a substantial increase in the number of foreign acquisitions of U.S. A&D companies with 2011 posting a deal volume increase of 61% and representing 25% of overall deal activity.
Download the Aerospace & Defense Update below.