TransDigm to Buy Data Device Corporation For $1.0 Billion Cash

TransDigm Group Inc (NYSE: TDG) disclosed that it reached a definitive deal to purchase ILC Holdings, Inc., the parent company of Data Device Corporation (DDC), for $1.0 billion in cash from Behrman Capital. The company expects to fund the acquisition through a combination of cash on hand, existing availability under its revolving credit facility and fresh debt. The company expects the acquisition to close before the end of the current year subject to regulatory approvals and customary closing conditions.TransDigm said that DDC, which is a leading supplier of databus and power supply products for the global military and commercial aerospace markets, is expected to generate more than $200 million revenue for the fiscal year ending December. The company added that about 75 percent of it will come from the defense market and the remainder primarily from the commercial transport market. Similarly, about 70 percent of revenue is generated from the aftermarket, with nearly all of the revenue from proprietary and sole source products while about 45% of revenue is generated from customers outside of the America. TransDigm's chairman and CEO, Nicholas Howley, commented, "DDC has a strong presence across major military aircraft platforms and a growing presence on commercial aircraft. This is another sizable acquisition opportunity that meets our strategic, operational and value-creation criteria."He continued to say that "The vast majority of DDC's revenue comes from highly engineered, proprietary products with substantial aftermarket content. We are pleased with the opportunity to acquire a business of this size that has such an outstanding reputation with its customers and where we see opportunities for significant value creation." Shares of the company traded 0.01 percent down on Monday.