Business

May 2, 2018
 

Boeing to acquire KLX Inc. to enhance services business growth

Boeing announced May 1 it has entered a definitive agreement to acquire KLX Inc. to enhance its growing services business.

The agreement comprises an all-cash transaction for $63 per share and the assumption of approximately $1.0 billion of net debt, totaling $4.25 billion.

Boeing’s acquisition of KLX Inc. will include KLX Inc.’s Aerospace Solutions Group, and is conditional upon the successful divestment and separation of KLX Inc.’s Energy Services Group.

KLX Inc. is a major independent provider of aviation parts and services in the aerospace industry. Its capabilities include global parts distribution and supply chain services for aerospace and defense industries worldwide. KLX Inc. will be part of Boeing Global Services and fully integrated with Aviall. 

KLX Inc. is also a leading supplier of chemical composites, with this combination broadening the scope of what Aviall can offer to customers in this space.

“This acquisition is the next step in our services growth strategy, with a clear opportunity to profitably grow our business and better serve our customers in a $2.6 trillion, 10-year services market,” said Stan Deal, president and CEO of Boeing Global Services. “By combining the talent and product offerings of Aviall and KLX Inc., we will provide a one-stop-shop that will benefit our supply chain and our various customers in a meaningful way.”

KLX Inc.’s Aerospace Solutions Group employees and operations will be integrated with Aviall, providing a clear path for the business to accelerate growth. The Miami facilities are expected to continue to remain the principal operating location.

“Our customers have long desired a supplier who could offer essentially 100 percent of their requirements for fasteners, consumables and expendables. The combination of Aviall and KLX Aerospace facilitates the broadest scope of parts and products to support all customer fleet types for the commercial, military and defense and business and general aviation markets,” said Amin Khoury, KLX Chairman and CEO. “This business combination will enable us to deliver industry-leading value-added service solutions for our customers, and outstanding growth opportunities for our suppliers.”

KLX Inc.’s Aerospace Solutions Group fiscal 2017 revenue was $1.4 billion. Boeing expects the acquisition to have a neutral earnings impact through 2019 and accretion thereafter, with annual cost savings growing to approximately $70 million by 2021 and further improvements realized over time. The transaction will be financed primarily with cash on hand, supplemented with debt.

The completion of the transaction is subject to customary conditions, including regulatory clearance and the approval by a majority of KLX Inc. shareholders. The sale is expected to close by 3Q 2018. The transaction is also subject to the successful divestment and separation of KLX Inc.’s Energy Services Group.

With approximately 2,000 employees, KLX Inc.’s Aerospace Solutions Group is headquartered in Miami with customer service centers located in more than 15 countries. As a major independent provider of new aviation parts and related aftermarket services, KLX Inc. markets and distributes products for approximately 2,400 manufacturers and offers approximately 1 million catalog items.




All of this week's top headlines to your email every Friday.


 
 

 
Sikorsky photograph

Sikorsky HH-60W combat rescue helo weapons system, operational flight trainers in final assembly

Sikorsky photograph Final assembly of the first Sikorsky HH-60W Combat Rescue Helicopter Weapons System and Operational Flight Trainers is underway. The flight simulators will train the full aircrew, allowing pilots and special...
 
 
Air Force photograph

AEDC Turbines team shows its dedication to meeting customer’s testing needs

Air Force photograph by Deirdre Ortiz AEDC test teams were conducting testing on the Rolls-Royce engine pictured here when facility crews at Arnold Air Force Base determined plant equipment needed to be replaced. The equipment ...
 
 

Boeing, Cathay Pacific to donate world’s 1st 777 to Aviation Museum

Boeing and Cathay Pacific announced today that they are donating the first-ever Boeing 777 airplane to the Pima Air & Space Museum in Arizona, one of the world’s largest facilities devoted to celebrating aerospace. The iconic airplane (line number WA001 and registered B-HNL) flew from Cathay Pacific’s home airport in Hong Kong to Tucson, Arizona...