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• Case | HBS Case Collection | May 2020 (Revised June 2020)

  TransDigm's Acquisition and Integration of Arkwin Industries

  Benjamin C. Esty and Daniel W. Fisher

  In May 2013, TransDigm, a company that manufactured a wide range of highly engineered aerospace parts for both military and civilian aircraft, announced it was buying Arkwin Industries for $286 million in cash (3 times Arkwin’s sales of $91 million). Having acquired more than 40 companies in the past 20 years, TransDigm was an experienced acquirer with a unique business model focused exclusively on value creation. This case describes TransDigm’s acquisition, integration, and talent development processes as well as the changes made at Arkwin over the following three years. It serves as a complement to the TransDigm in 2017 case (HBS #720-422). Whereas the TransDigm case provides an overview of the company, its history, its value creation strategy, and its financial performance, the Arkwin Industries case provides a deep dive into a single transaction as a way to illustrate TransDigm’s value creation strategy in practice. That strategy consisted of three parts—value-based pricing, cost reductions, and new product development—and had the goal of doubling a target firm’s operating margins and cash flows within five years.

  Citation:

  Esty, Benjamin C., and Daniel W. Fisher. "TransDigm's Acquisition and Integration of Arkwin Industries." Harvard Business School Case 720-467, May 2020. (Revised June 2020.)  View Details

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• Supplement | HBS Case Collection | May 2020 (Revised June 2020)

  TransDigm's Acquisition and Integration of Arkwin Industries

  Benjamin C. Esty and Daniel W. Fisher

  This courseware accompanies the case "TransDigm’s Acquisition and Integration of Arkwin Industries"

  Citation:

  Esty, Benjamin C., and Daniel W. Fisher. "TransDigm's Acquisition and Integration of Arkwin Industries." Harvard Business School Spreadsheet Supplement 720-857, May 2020. (Revised June 2020.)  View Details

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• Case | HBS Case Collection | June 2020

  TransDigm: The Acquisition of Aerosonic Corp.

  Benjamin C. Esty and Daniel W. Fisher

  In April 2013, TransDigm, a company that manufactured a wide range of highly engineered aerospace parts for both military and commercial aircraft, announced an agreement to acquire Aerosonic Corporation for $39 million in cash (1.2 times Aerosonic’s sales of $31 million). Having acquired more than 40 companies in the past 20 years, TransDigm was an experienced acquirer with a unique business model focused exclusively on value creation. This case describes TransDigm’s acquisition process with a focus on the merger negotiations and the key contractual terms in the merger agreement (break-up fees, go shop period, standstill provision, top-up options, etc.). It serves as a complement to the TransDigm in 2017 case (HBS #720-422). Whereas the TransDigm case provides an overview of the company, its history, its value creation strategy, and its financial performance, the Aerosonic case provides a deep dive into a single transaction as a way to illustrate TransDigm’s acquisition-driven growth strategy and to practice valuing an acquisition offer using multiple methods. Ultimately, the goal is to understand the change in value from a standalone company to a fully integrated and value-enhanced subsidiary of the TransDigm Group.

  Keywords: Mergers and Acquisitions; Growth Management; Business Strategy; Competitive Strategy; Value Creation; Valuation; Negotiation; Cash Flow; Contracts; Aerospace Industry; Air Transportation Industry; United States;

  Citation:

  Esty, Benjamin C., and Daniel W. Fisher. "TransDigm: The Acquisition of Aerosonic Corp." Harvard Business School Case 720-480, June 2020.  View Details

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