Oshkosh Corporation entered into a definitive agreement to acquire the AeroTech business from JBT Corporation in an US$800 million all-cash transaction. AeroTech is a provider of aviation ground support products, gate equipment and airport services to commercial airlines, airports, air-freight carriers, ground handling and military customers.
Oshkosh states AeroTech owns many of the most trusted brands in the air transportation industry with systems in the field that serve approximately 75 per cent of air travellers at U.S. airports and load approximately 70 per cent of the world’s overnight express packages.
Oshkosh explains AeroTech’s products are closely aligned with its technology focus areas, including electrification, autonomy and active safety and intelligent, connected products. With AeroTech, Oshkosh will enter the air transportation support market.
The acquisition is expected to be accretive to Oshkosh’s growth and margins and deliver recurring revenue from its aftermarket parts and services offerings.
“AeroTech meets all the criteria of our M&A priorities, and we believe it will enhance the financial profile of our Vocational segment, further strengthening this growing segment and enabling it to move beyond our goal of $3 billion-plus annual revenue with double-digit margins,” said John Pfeifer, CEO of Oshkosh Corporation.
When adjusted for the present value of expected tax benefits of approximately US$80 million, according to Oshkosh, the purchase price is US$720 million. Oshkosh explains this represents approximately nine times earnings before interest, taxes, depreciation and amortization (EBITDA) based on the expected 2023 second half run-rate or approximately 7.2x EBITDA, including expected run-rate synergies. Upon close, AeroTech will become part of the Oshkosh Vocational segment.
