Key facts
- Aerospace and defense M&A is accelerating due to clearer production schedules from Boeing and Airbus.
- GE Aerospace is acquiring Consolidated Precision Products (CPP) for $12 billion to secure casting technology and address jet engine part shortages.
- Through August, 154 commercial aerospace transactions were recorded, nearing the 2019 record of 159.
- The combined value of deals through August was $14 billion, compared to $37.5 billion for all of last year.
- Boeing delivered 600 jets in 2023 and aims to surpass that this year, while Airbus targets 870 deliveries.
- Howmet CEO John Plant is comfortable with the GE Aerospace acquisition of CPP, despite Howmet facing capacity constraints due to high demand.
Mergers and acquisitions within the aerospace supply chain are accelerating as manufacturers like Boeing and Airbus provide clearer production schedules, boosting buyer confidence in long-term demand. This trend is driven by the need to secure suppliers with specialized manufacturing capabilities and capacity to meet rising jet output.
GE Aerospace announced this week its $12 billion acquisition of Consolidated Precision Products (CPP), a move aimed at securing casting technology and addressing shortages of jet engine parts. In a similar strategic move, Parker Hannifin agreed in May to purchase Circor’s aerospace division for $2.6 billion.
According to Janes Capital Partners, 154 publicly disclosed commercial aerospace transactions have occurred this year through August, nearing the 2019 record of 159. The combined value of these deals stands at $14 billion, a decrease from the $37.5 billion recorded for all of last year. The highest annual value was in 2015, with 106 transactions totaling $59.4 billion.
Boeing's jetliner deliveries have stabilized, recovering to 528 in 2023 and on track to exceed that figure this year, while Airbus aims for 870 deliveries in 2024, surpassing its 2019 pre-pandemic record. This increased production visibility allows buyers to more comfortably price future performance, even amid Boeing's ongoing production challenges.
Many private equity firms are now bringing portfolio companies to market after holding onto them longer due to pandemic-era production swings and inventory issues. Howmet Aerospace CEO John Plant stated he is comfortable with GE Aerospace's acquisition of CPP, even as Howmet itself faces capacity constraints due to soaring demand for its own engine parts and components for data center turbines.