“This acquisition is the next step in our services growth strategy, with a clear opportunity to profitably grow our business and better serve our customers in a $2.6 trillion, 10-year services market,” Boeing Global Services president and CEO Stan Deal said.
Boeing is paying $63 per share for KLX and taking on $1 billion in net debt, totaling $4.25 billion. Boeing estimates that the acquisition will generate approximately $70 million in annual cost savings by 2021, with potential for further improvements.
KLX employs approximately 2,000 staff and has customer service centers in more than 15 countries The company, which generated $1.4 billion revenue in 2017, will be integrated into Boeing Global Services.
“KLX Inc.’s Aerospace Solutions Group employees and operations will be integrated with [Boeing parts and supply-chain subsidiary] Aviall, providing a clear path for the business to accelerate growth. The Miami facilities are expected to continue to remain the principal operating location,” Boeing said.
Boeing added that KLX’s composites capabilities will broaden Aviall’s product range.
“Our customers have long desired a supplier who could offer essentially 100% of their requirements for fasteners, consumables and expendables. The combination of Aviall and KLX Aerospace facilitates the broadest scope of parts and products to support all customer fleet types for the commercial, military and defense and business and general aviation markets,” KLX chairman and CEO Amin Khoury said.
The deal is conditional on the divestment and separation of KLX’s Energy Services Group, as well as regulatory clearances and KLX shareholder approval.
Boeing’s guidance remained unchanged by the acquisition, with a neutral earnings impact through 2019. The sale is expected to close by the third quarter of 2018.
A ATN release || May 02, 2018 |||
