Mission control: Fourth-quarter 2013 aerospace and defense industry mergers and acquisitions analysis

February 2014
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Mission control: Fourth-quarter 2013 aerospace and defense industry mergers and acquisitions analysis

At a glance

Aerospace and defense merger & acquisition (M&A) volume and value were weak in 2013, and global deal activity shifted toward local deals. Despite lackluster activity, the deal market remains focused on aerospace targets, and aerospace valuations have come more in line with historical norms, which could support a robust aerospace deal market in 2014.

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Mission control, a quarterly analysis of global merger and acquisition (M&A) activity in the A&D industry, provides an overview of the most recent M&A results and our expectations for future deal activity.

This report highlights several trends expected to affect the characteristics of deals in the A&D sector, including:

  • Private equity sellers were among the primary drivers of M&A activity in 2013
  • China is continuing its efforts to advance its domestic aerospace industry
  • The market for local deals remains strong by historical standards, with almost three-quarters of deals involving parties from the same country
  • Aerospace targets remain popular, particularly among tier 2 and 3 suppliers
  • Defense volume and value are hovering just above ten year lows
  • There appears to be some pent-up demand for defense deals, which have been on hold due to sequestration related uncertainty

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