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StandardAero, a portfolio company of Carlyle, has acquired military MRO provider Aero Turbine from private equity (PE) firm Gallant Capital for an undisclosed sum.
Founded in 1978, California-based Aero Turbine has a customer portfolio that includes the U.S. Air Force, U.S. Navy, foreign militaries, Magellan Aerospace and Textron-owned ATAC.
In an announcement, Gallant says it partnered with Aero Turbine’s founder, Doug Clayton, and its CEO, Jim Simpkins, to “transform the business into an industry leading defense MRO.” Gallant acquired Aero Turbine in January 2019.
Aero Turbine is StandardAero’s 13th acquisition since 2015 and comes amid speculation that the company either will go public or be sold by Carlyle. Bloomberg reported in July that several PE firms are considering bidding for StandardAero, including Blackstone and CVC Capital Partners. Bids could value the Scottsdale, Arizona-based company at $10 billion, Bloomberg estimated, citing “people with knowledge of the matter.”
In an Aug. 23 research note, financial data provider PitchBook said that there have been 13 PE-backed investments in the aviation MRO segment this year through Aug. 15, accounting for about half of all such M&A deals.
Looking ahead, PitchBook predicts that “an influx of PE capital” will flow into the aftermarket, which aligns with the bullish view of the sector among other analysts. Investment bank Jefferies estimates that aftermarket revenue reached 109% of 2023 levels in the first quarter of 2024 and in an April report raised the possibility of a “supercycle” for the next three to four years.
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