Arcline Investment Management has agreed to acquire Novaria Group from KKR in a transaction valued at $2.2 billion. Novaria is a leading provider of engineered aerospace components and specialty processes serving more than 3,000 customers worldwide.
The deal will provide cash payouts to all Novaria employees through the company’s ownership program and is expected to support the company’s continued expansion across the aerospace and defense supply chain.
KKR originally invested in Novaria in 2020, working alongside the company’s leadership team to scale operations and expand market coverage. Since that investment, Novaria has more than tripled in size and completed 13 strategic acquisitions, which broadened the company’s product portfolio and manufacturing footprint. The company now employs over 1,600 people across the United States.
During KKR’s ownership period, Novaria reported measurable improvements in organizational performance. 1) Safety improvements have reduced its total recordable incident rate by over 60% since 2021. 2) The company achieved nearly a 20% reduction in voluntary turnover over the same period. 3) Novaria also reached the top quartile standing on the Ownership Works index for manufacturing companies, reflecting strengthened employee engagement.
As part of the employee ownership program established under KKR’s involvement, every one of Novaria’s more than 1,600 employees will receive a cash payout upon closing. The transaction remains subject to customary regulatory approvals and closing conditions.
Advisors/support: KKR and Novaria were advised by Morgan Stanley as financial advisor and Kirkland & Ellis as legal advisor. Sterlington advised Novaria Group’s management team on executive compensation matters as part of this transaction.
KEY QUOTES:
“We are proud of how we built Novaria in partnership with the management team into a resilient aerospace and defense supplier that benefits its employees and customers. This milestone was enabled by an ownership mindset, operational excellence, and putting our people first, and we are pleased to see all employees share in the value they helped create.”
Josh Weisenbeck, Partner at KKR
“This transaction represents the success of our long-standing partnership with KKR and the dedication of the Novaria team. Novaria’s focus on customer partnership within the aerospace industry has driven remarkable results, and this outcome is a reflection of the collective effort and commitment of our colleagues.”
Bryan Perkins, CEO of Novaria Group
