GCG’s Q4 2021 A&D Industry Update provides an overview of the latest trends in the sector, including recent equity market performance, valuation multiples, and transaction activity.
Key findings include the following:
- The 737 MAX was re-certified by the Civil Aviation Administration of China (CAAC) allowing for a return to service in the country. Boeing is currently producing the 737 MAX at a rate of 26 aircraft per month and continues to expect a previously stated target of 31 per month. Boeing reported an inventory on the aircraft of approximately 335 at the end of the fourth quarter.
- The $768 Billion 2022 National Defense Authorization Act (NDAA) was passed in Congress and signed by President Biden, however the NDAA does not authorize funding until Congress passes a wider appropriations bill for FY2022. A continuing resolution remains in effect for fiscal 2022 with a current expiration date of February 18th.
- There were 102 transactions within the A&D industry involving United States-based targets or acquirers, increasing from 95 in Q3 2021. This was the highest level of activity in the last four years. 86% of Q4 2021 transactions involved strategic acquirers with the remaining 14% representing platform acquisitions by financial buyers.
- Categorically, approximately 43% of transactions took place in the Aerospace industry, 25% in the Defense IT/Services, 24% in Defense, and 8% in Space. Representative transactions are further highlighted in the report.
Click here for the full update.