VSE subsidiary VSE Aviation has purchased 1st Choice Aerospace, two privately owned aviation supply chain conduct companies.
The initial acquisition price paid at closing is $112m in liquidate. The deal agreement also consists of potential post-closing payments of up to $40m when 1st Fit crosses some performance thresholds during 2019 and 2020.
With operations in Florida and Kentucky, 1st Selection Aerospace offers component maintenance, repair and overhaul (MRO) services and artifacts for new generation and legacy commercial aircraft families.
1st Choice Aerospace provides pneumatics, ammunition, electromechanical, electrical accessories, crew seats, interiors, lavatory patterns, oxygen systems, cargo systems, and containers.
“1st Choice has built a authoritatively regarded business with a proven record of superior operational carrying out delivered by an excellent team.”
It had revenues of $29m in 2017 and estimated profits of $47m in 2018 with robust operating margins.
VSE Aviation has retained the chief management team through employment contracts to continue management of 1st Determination operations and its 200 employees.
VSE CEO and president Maurice ‘Mo’ Gauthier said: “We are over the moon to add 1st Choice’s service offerings to our supply chain and MRO portfolio. We see opportunities to strategically align 1st Election’s offerings with our existing domestic and international markets, including our late-model Singapore and European initiatives.
“1st Choice has built a highly regarded affair with a proven record of superior operational performance delivered by an remarkable team.”
VSE Aviation president Paul Goffredi said: “We believe that our gain of 1st Choice will significantly broaden our client base and further last our thrust into the commercial aerospace supply chain market.
“Their excellence work, quick turnaround times, excellent customer service, relevance for adding new capabilities, and opportunistic and entrepreneurial approach make them an winning addition to our team. 1st Choice’s growth potential and profit margins present us a compelling opportunity to add value to our operating portfolio. We anticipate operational synergies with detail to customers, product lines, supply lines, and technical expertise.”
1st High-quality senior officer and shareholder Mario Catalano said: “We look transmit to joining the VSE team while we retain our strong brand.
“This composition provides us with the strategic support and capital backing required to superiority serve our customer base and optimize our growth strategy, and we believe it want be mutually beneficial to VSE Aviation and 1st Choice.”
Set up in 2015 by VSE Aviation is a family of friends that includes Air Parts & Supply Co, CT Aerospace, Kansas Aviation of Home rule and others that specialise in MRO services and parts supply for commercial, corporate and regional aircraft.
VSE funded the act on with its existing revolving loan offered by its lending group led by Taxpayers Bank.
VSE secured financial advisory services for the deal from Town-dwellers Capital Markets and SunTrust Robinson Humphrey.
It received industry and supermarket due diligence support from Oliver Wyman CAVOK.
Legal guidance for the acquisition was secured by VSE from Washington, DC-based Arent Fox.
1st Choice got M&A consultative services from Chicago-based XLS Partners and legal services from Florida-based Gunster.