Safran have announced the contemplated acquisition of Collins Aerospace’s high-technology actuation and flight control activities, which are mission critical for commercial & military aircraft and helicopters.
The business has around 3,700 employees across eight facilities in Europe (France, UK and Italy) and in Asia, and also benefits from MRO and engineering capabilities.
Further, it is expected to generate sales of approximately $1.5 billion and an EBITDA of $130 million in 2024E.
The key strategic benefits of this transaction for Safran include:
- Highly complementary product offerings creating a leading player (~$1.8 billion combined sales in 2024E) with an end-to-end product portfolio – Collins’ actuation and flight control business would bring Safran a full set of capabilities and products enabling the Group to become a leading integrated player with an end-to-end actuation and flight control product portfolio;
- Synergetic exposure across commercial, military aircraft and helicopter segments, with strong legacy programs – These additional capabilities would offer Safran a well-balanced exposure to diverse customer segments and product categories and strong positions on mature and growth platforms
- Complementary capabilities in hydraulic and electromechanical actuation positioning Safran well for next-generation aircraft – Collins’ best-in-class hydraulic and mechanical actuation capabilities would combine with Safran’s current know-how in electrical actuation and electronics and well-position the Group for future aircraft programs;
- Attractive exposure to valuable and recurring aftermarket revenue streams – c. 40% of the acquired sales stem from aftermarket which would allow Safran to strengthen its exposure to this highly attractive revenue source;
- Compelling value creation supported by short-medium term cost synergy potential – Well-identified sources of cost synergies, with further upside to be captured from commercial synergies
The contemplated transaction is subject to the information and consultation procedure with the relevant employee representative bodies of Collins and Safran, as well as the customary regulatory approvals and closing conditions.
The closing is expected to take place in the course of H2 2024.
