Latecoere, a “Tier 1” international partner of the world’s major aircraft manufacturers, announces today it has entered into a definitive Arrangement Agreement to acquire all of the issued and outstanding common shares in the capital of Avcorp, a Canadian domiciled company that builds major airframe structures for some of the world’s leading aircraft companies.
Avcorp is an aerostructures supplier of wing sub-assemblies, large scale composite parts and after-market services, with exposure to key platforms including F-35, B737 Max, B767 and B787. Avcorp generated CAD$99 million in revenue in 2021 with over 450 skilled employees. The company has three major manufacturing sites in Delta, British Columbia (metallic and composite aerostructures assembly and integration), Gardena, California (advanced composite aerostructures fabrication capabilities) and Burlington, Ontario (structural component repair services for commercial aircrafts).
Strategic Fit
The acquisition of Avcorp is part of Latecoere’s 2025 roadmap to achieve profitable growth as an active consolidator of the aeronautics industry. In this context, the Company has already completed a number of acquisitions in 2021 (Bombardier EWIS, TAC and SDM) as well as announced the acquisition of MADES, which is subject to the approval by the Spanish Council of Ministers pursuant to defence foreign direct investment regulations and is expected to close during Q2 2022. The acquisition of Avcorp continues this consolidation, strengthening the Group’s Aerostructures business by way of:
The Avcorp management team is led by Amandeep Kaler, CEO, who has a solid track record in the industry and has been working within the company for over 20 years. This team will continue to manage the company and support business activity.
Thierry Mootz, Group Chief Executive Officer, stated: “In 2021 Latecoere has actively participated in aerospace market consolidation, which continues into 2022 with the acquisition of Avcorp. Avcorp is an excellent business with a track record of delivering first class performance. Its successful management team share our approach and vision for the enlarged business. The two businesses have complementary client bases, geographical strengths and service offerings. There are exciting opportunities to combine Avcorp’s expertise in defence and strong presence in North America with Latecoere’s end-to-end technical capabilities and global footprint. Thanks to this new acquisition the Group is well positioned to serve the aerospace industry with innovative solutions for a sustainable world and on track to deliver its Ambition 2025 growth plan. On the top of rescaling the Group, it will reposition the company on profitable growing segments.”
Commenting on the transaction Amandeep Kaler, CEO of Avcorp, said: “This transaction represents the culmination of an extended strategic review through a very challenging business environment to find a partner with the financial strength and expanded customer base to build upon Avcorp’s developed expertise in composite aerostructure assembly and integration. Along with an attractive premium to the weighted average share price, the transaction provides a liquidity event for all of our shareholders. In addition, Avcorp’s stakeholders will benefit from the enhanced financial position, broader customer base and improved competitive position resulting from the integration with a Tier 1 international partner.”
Read the press release (5 May 2022), including transaction key terms and time line.
Photo credit: ©Avcorp
