Esterline Corp. [ESL] on Monday said it has agreed to acquire the aerospace and defense display business of Belgium’s Barco N.V.
for about $200 million, expanding its global business and its display capability.
Esterline expects the deal to be modestly accretive in its fiscal year 2015 and “significantly more so over time.” The company also said the deal, which will be funded by international cash reserves, is expected to close in December or January pending regulatory approval by the United States government and completion of French employee protective rights procedures.
Barco’s displays business has 600 employees and annual sales of $200 million. Sales are balanced between aerospace and defense work and customers include Lockheed Martin [LMT], Honeywell [HON], Europe’s Airbus Group and France’s Thales.
“This acquisition will rapidly expand our global display capability and better position the company across a wide range of growing end markets,” Curtiss Reusser, Esterline’s CEO, said in a statement. “The immediate and cost-effective expansion of Esterline’s visual display business, and important core technology, will reinforce our ability to pursue opportunities with a variety of customers.”
Esterline also expects to grow its overall displays business as a result of the acquisition.
“We see significant growth potential as we leverage the strategic and financial fit of this acquisition to drive value and opportunity for our customers, our growing family of employees, and our shareholders,” Reusser said.
Esterline said that Barco’s display business has positions in the avionics, defense, air traffic control, and training and simulation markets. The company said the acquisition would also enhance its position as a supplier of human-machine interface products for aerospace customers in the commercial and defense markets.
Barco’s displays business will become part of Esterline’s Avionics & Controls business segment.
Barco’s financial adviser on the transaction is Morgan Stanley. Esterline is being advised by Rothschild and Renaissance Strategic Advisors.