VSE extends Supply Chain Management and MRO to the Aviation Market
Company Website:
http://www.vsecorp.com
ALEXANDRIA, Va. -- (Business Wire)
VSE Corporation (NASDAQ: VSEC) announced today that it has closed on the
previously announced acquisition of four business units from Killick
Aerospace Group, consisting of Prime Turbines (including both U.S. and
Germany-based operations), CT Aerospace, Kansas Aviation of Independence
and Air Parts & Supply Co. The companies specialize in maintenance,
repair and overhaul (MRO) services and parts supply for corporate and
regional jet aircraft engines and engine accessories. The acquisition of
the Killick companies expands VSE’s supply chain management and MRO
capabilities to commercial aviation markets, and gives us another
service offering to take to our federal markets.
The initial purchase price paid at the closing was approximately
$189 million in cash. The increase of approximately $5 million from the
previously announced initial purchase payable at closing was a result of
an estimated increase in the net working capital of the acquired
companies as of the closing date. The purchase agreement also includes
potential post-closing payments of up to $40 million if CT Aerospace,
Kansas Aviation of Independence and Air Parts & Supply Co. surpass
certain thresholds of earnings before interest, taxes, depreciation and
amortization (“EBITDA”) during the first two years after the closing and
one additional post closing payment of $5 million if such companies
surpass a certain EBITDA threshold during any 12-consecutive month
period in 2014 and 2015. Other purchase price adjustments also may be
required based on certain post-closing determinations, including in
respect of the closing net working capital and certain inventory and
equipment.
The four business units combined sales and income before taxes are
estimated to be approximately $111 million and $22 million,
respectively, for the year ended December 31, 2014. Such estimated
results are not necessarily indicative of future financial performance
and the actual results of the four business units for 2014 may differ
from the estimated results. The four business units have approximately
196 employees.
“We are pleased to add these four complementary aviation business units
to our supply chain management and maintenance, repair and overhaul
portfolio,” said VSE CEO and President, Maurice “Mo” Gauthier. “We plan
to maintain each company’s respective brand as we integrate these
companies under the umbrella of our recently formed subsidiary VSE
Aviation, Inc., led by Paul Goffredi as President. Paul has held several
leadership positions in the aviation industry for nearly three decades
and has been with Killick Aerospace for four years. We look forward to
Paul’s contributions for growing our presence in those markets.”
In connection with its acquisition of the Killick companies, VSE amended
a loan agreement with its bank group to extend the agreement for five
years and increase the commitment to $300 million, which consists of a
$150 million revolving credit facility and $150 million term loan
facility.
VSE received legal advice for the acquisition from Arent Fox LLP,
Washington, D.C. Citizens Bank, N.A. provided financial advisory
services to VSE and arranged financing for the acquisition. The Killick
Aerospace Group was advised by Wells Fargo Securities, LLC (financial
advisor) as well as legal advisors Dentons USA LLP and Osler, Hoskin &
Harcourt LLP.
About VSE
Established in 1959, VSE is a diversified sustainment and services
company with experience in solving issues of global significance with
integrity, agility, and value. VSE is dedicated to making our federal
and commercial clients successful by delivering innovative solutions for
ship, vehicle and aircraft sustainment, supply chain management,
platform modernization, mission enhancement, program management, energy,
IT, and consulting services. For additional information regarding VSE
services and products, please see the Company's web site at www.vsecorp.com
or contact Christine Kaineg, VSE Investor Relations, at (703) 329-3263.
Safe Harbor
This news release contains statements that to the extent they are not
recitations of historical fact, constitute “forward looking statements”
under federal securities laws. All such statements are intended to be
subject to the safe harbor protection provided by applicable securities
laws. For discussions identifying some important factors that could
cause actual VSE results to differ materially from those anticipated in
the forward looking statements in this news release, see VSE’s public
filings with the SEC, including VSE’s Annual Report on Form 10-K for the
year ended December 31, 2013 and subsequent reports filed with the SEC.
Contacts:
VSE News Contact:
Christine Kaineg, 703-329-3263
Source: VSE Corporation
© 2024 Canjex Publishing Ltd. All rights reserved.