Mission control: First-quarter 2015 aerospace and defense industry mergers and acquisitions analysis
At a glance
M&A activity in the aerospace and defense sector is off to a strong start in 2015 with deal value increasing on both a quarter-over-quarter and annual basis. The largest A&D deal since sequestration was recorded in Q1.
Mission control is PwC's quarterly analysis of merger and acquisition (M&A) activity in the global aerospace & defense sector. It provides an overview of the most recent M&A results and our expectations for future deal activity.
Highlights of what this quarter's analysis revealed:
The largest transaction since 2011 occurred in the first quarter of 2015.
Divestitures and spin-offs remained popular in 1Q15, accounting for six of the nine deals in the quarter.
Increasing supply chain complexities and OEM pressure is spurring activity among mid- and lower- tier players across the supply chain.
Defense players continue to look for pockets of strategic growth areas particularly among intelligence, surveillance, and reconnaissance assets as well as electronic warfare.
Financial investors favor stability and niche capabilities.
Commercial MRO market is likely to see an increase in business and transaction activity.
A&D companies continue to announce plans to return capital to shareholders through buybacks, supported by strong cash flows.