Parker-Hannifin To Acquire Meggitt For ~£6.3B - Parker Hannifin (NYSE:PH)

Parker-Hannifin Corp PH has agreed on the terms of a recommended cash acquisition of Meggitt PLC MEGGF, a global leader in aerospace and defense motion and control technologies.
The transaction consideration to be 800 pence in cash per Meggitt share, valuing Meggitt at ~£6.3 billion on a fully diluted basis, which is ~70.5% premium to Meggitt's share price on July 30.
This transaction is expected to be EPS accretive in the first full 12 months after closing, along with incremental solid sales growth, margins and cash flow accretion, high single-digit ROIC in year 5 with continued expansion, and a significant synergy opportunity of ~$300 million by the third full year.
Meggitt's FY20 annual revenue was ~$2.3 billion and has more than 9,000 employs. It is listed on the London Stock Exchange and is a constituent of the FTSE 250 index.
This acquisition to nearly double the size of the Aerospace Systems Segment with complementary technologies for Parker-Hannifin. It will generate strong recurring revenue – adding 500 bps to the Aerospace aftermarket mix.
Meggitt and Parker are complementary across diverse portfolios of products. They will thus expand and develop core product lines, add new capabilities, and enable innovations on more electric, low-carbon, and other vital technologies.
Parker held cash and cash equivalents of $489.6 million as of March 31, 2021.
Price Action: PH shares are down 0.13% at $311.62, while MEGGF stock is up 56.32% at $10.16 on the last check Monday.

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