Meggitt snaps up PSA for $685m

18th Jan 2011 07:09

Fast expanding engineer Meggitt has taken another leap forward with agreement to acquire Pacific Scientific Aerospace (PSA) from US firm Danaher for $685m in cash. A placing of 69.8m new shares will help fund the deal.PSA specialises in fire suppression, sensing, electric power, electric actuation and security products, with a revenue split of roughly 60:40 between civil aerospace and and military markets.The US firm generated underlying operating profits of $79m and revenues of $378m in 2010. The acquisition is expected to be earnings enhancing immediately.Meggitt says PSA will broaden its product range to encompass fire and smoke suppression, giving it an integrated fire and smoke detection and suppression capability. PSA will also enable it to provide electric systems as aircraft of the future shift away from hydraulic / pneumatic technology towards electric power and increase Meggitt's presence on major civil and military platforms such as the Boeing 787, Airbus A380, A350 and A400M and Eurocopter NH-90. "The acquisition of PSA today represents a further major step in the strategic growth and development of the Meggitt Group and fits well into Meggitt's business model, with strong technology positions, a significant level of sole source content and aftermarket sales representing over one-third of PSA's total revenues," chief executive Terry Twigger said.