Jul. 19—WHITE PLAINS, NY / ACCESSWIRE / July 19, 2024 / Loar Holdings Inc. has announced it has signed a definitive agreement to acquire Applied Avionics, Inc. for $385 million in cash.
Incorporated in 1968, Applied Avionics designs, develops, and manufactures highly engineered avionics interface solutions. Applied Avionics' brands, VIVISUN and NEXSYS, are the preferred choices of leading aircraft retrofit providers, military prime contractors, Tier 1 suppliers, and OEMs, among others. Given the bespoke nature of the solutions, nearly all Applied Avionics' revenues are derived from proprietary designs. Applied Avionics products are found on a multitude of platforms in both the commercial and military aerospace and defense end-markets.
Applied Avionics employs over 80 teammates at its headquarters and manufacturing facility in Fort Worth, Texas. Applied Avionics sales and adjusted EBITDA for the year ending December 31, 2024, is expected to be approximately $40 million and $21 million, respectively. Loar expects to receive tax benefits of approximately $45 million as a result of the transaction. Therefore, including the estimated tax benefit, Loar's effective purchase price multiple will be approximately 16x Applied Avionics 2024 adjusted EBITDA.
"We are excited about the addition of Applied Avionics to the Loar family." stated Dirkson Charles, CEO and Executive Co-Chairman of the Board of Directors of Loar. " Applied Avionics fits our strategic initiative of adding niche capabilities and proprietary products to our suite of customer solutions. Additionally, over 75% of Applied Avionics' sales are derived from the aftermarket, further strengthening this attribute and strategic focus of Loar."
The transaction is expected to close shortly after receiving requisite regulatory approvals and is subject to customary closing conditions. The acquisition will be financed through additional borrowings under Loar's existing credit agreement and cash on-hand.
