AAR, a leading global aviation services provider to commercial and government operators, announced the acquisition of HAECO Americas from HAECO Group for $78 million in cash, expanding its heavy maintenance footprint and accelerating growth within its Repair & Engineering segment. The deal, subject to customary adjustments, represents a high single-digit multiple of the last twelve months of EBITDA before synergies.
As part of the transaction, AAR has also secured long-term heavy maintenance contracts with key customers valued at over $850 million. The company said these agreements will effectively sell out HAECO Americas’ two facilities in Greensboro, North Carolina, and Lake City, Florida, which serve leading commercial airlines.
HAECO Americas is the second-largest heavy maintenance provider in North America, following AAR. Its 1,600-person workforce brings extensive experience in aircraft maintenance, repair, and overhaul (MRO) and modification services. Approximately 30% of its team members are veterans.
The acquisition will bolster AAR’s already significant MRO network, which includes facilities undergoing expansions in Miami and Oklahoma City. The company expects the integration of HAECO Americas to enhance its ability to meet growing customer demand while improving profitability and operational efficiency over time.
AAR has outlined several strategic benefits of the acquisition, including the acceleration of its long-term growth objectives, optimization of its North American maintenance footprint, and realization of operational synergies. While the deal may be slightly dilutive to operating margins in the short term, the company anticipates significant improvements as its operational model is applied to the new facilities.
AAR operates in more than 20 countries and supports commercial and government customers through four core segments: Parts Supply, Repair & Engineering, Integrated Solutions, and Expeditionary Services. The company is headquartered near Chicago and continues to position itself as the leading independent MRO provider in North America.
KEY QUOTES:
“AAR has become the most sought-after heavy maintenance provider in North America, and we are excited to extend our leadership position with the acquisition of HAECO Americas. Over the last few years, we have significantly invested in training, lean initiatives, and proprietary technology to enhance quality and efficiency in our MRO operations. These efforts have resulted in reduced turn-around times for our customers, higher employee retention, and meaningful increases to operating margins. We plan to apply our successful model to the HAECO Americas facilities and expect to significantly improve profitability and operational performance.”
“In connection with the transaction, we have secured agreements with key customers, totaling over $850M in sales over a multi-year period. These agreements, which effectively sell out the two HAECO Americas facilities, reflect strong demand and our close customer relationships. Moreover, these new facilities will allow us to further optimize our North American footprint, which we expect will lead to incremental margin expansion overall for our Repair & Engineering segment as we execute the integration.”
John M. Holmes, Chairman, President and CEO, AAR CORP.
“We are pleased to welcome the talented HAECO Americas team to AAR. Our strong safety culture, partnerships with educational institutions, and focus on career development have made AAR the premier employer for aviation technicians. We look forward to combining with the HAECO Americas team to deliver outstanding service to our customers.”
Tom Hoferer, Senior Vice President of Repair & Engineering, AAR CORP.
