Financial firm Crosslake Group announced on March 11 that it had completed the acquisition of the South Florida-based MRO companies Continental Aircraft Support and Magnum Aircraft Repair Services (M.A.R.S.) for an undisclosed sum.
Continental and M.A.R.S. will be integrated into Crosslake’s Aftermarket Aviation Parts Investment Platform, which provides parts manufacturing, repairs and overhaul, and exchange as well as spare parts sourcing and overall fleet management programs. Leading the investment platform is Aeromax Industries, which works with both the U.S. and foreign militaries supporting manufacturing and spare parts programs. Aeromax is a supplier and manufacturer for Northrop Grumman’s F5 aircraft and the GE J85 engine.
Together, Continental and M.A.R.S have more than 250 existing customers, among them the U.S. Defense Department, major U.S. airlines, AAR Corp., the United Arab Emirates Air Force, and UAE airlines.
The objective of the acquisitions is to “create an integrated aftermarket parts solution company for defense and commercial aviation fleet managers,” Crosslake Managing Principal Britt Gourley tells Aviation Week.
In response to a query from Aviation Week about the amount paid for the two companies, Gourley said that “this was a market rate deal for MROs in this segment, a middle market vertical integration acquisition with a lower eight-figure purchase price.” The transaction closed on Dec. 8, 2023.
Fort Worth, Texas-based Crosslake provides liquidity to existing owners of A&D businesses with gross revenues of $5 million to $50 million. In addition to providing capital to Crosslake’s portfolio companies, the financial firm assists them with strategic planning, risk management and finance.
In a news release, Crosslake partner Grant Dunham said that the financial firm’s new partners at Continental and M.A.R.S. “have built customer-focused component MRO businesses that align with our core values,” adding that the leadership at those two companies will continue in their current roles.
There are “no fundamental operational changes to the acquired companies,” Gourley said, adding that Continental’s and M.A.R.S.’s management are now partners in Crosslake’s Aftermarket Platform.
Looking ahead, Crosslake says that another parts company investment is slated to close in June. Its current investments under consideration have purchase prices that range from seven figures to mid-eight figures.
Overall, the financial firm aims to increase its aviation platform diversification, “especially military,” says Gourley, adding that in the MRO segment, Crosslake plans to invest in more niche service lines: non-engine and non-structural.
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