Describing the move as a boon to its growing vocational segment and an opportunity to bolster the air transportation support market for which it is in the early stages of investment, Oshkosh Corporation President and CEO John Pfeifer announced May 30 that the company has entered into an agreement to acquire the business AeroTech — a maker of aviation ground support products, gate equipment and airport services — from the Chicago-headquartered global firm JBT Corporation.
The deal is an all-cash $800 million transaction. When adjusted for the present value of expected tax benefits of approximately $80 million, the company announced, the official purchase price is $720 million.
“This transaction supports our ‘Innovate. Serve. Advance.’ business strategy as we enter the attractive air transportation support space with a market-leading portfolio of purpose-built products and comprehensive service offerings,” Pfeifer said. “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.”
Approximately 75% of U.S. air travel is supported by AeroTech products, which include ground support equipment like cargo tractors, aircraft tugs, deicers and passenger steps and gate equipment like boarding bridges and elevating walks. AeroTech also manufactures and supports aviation ground equipment for the defense industry.
“The divestiture of AeroTech supports our strategy to become a pure-play food and beverage solutions provider,” said Brian Deck, JBT’s president and CEO. “Oshkosh, a leading innovator of purpose-built vehicles and equipment, is a great fit with AeroTech and will ensure the AeroTech business remains a market leader for critical airport equipment and infrastructure.”
Pfeifer says AeroTech’s products align closely with Oshkosh Corporation’s technology focus areas, which include electrification, autonomy and active safety, and intelligent, connected products.
“We look forward to working with the AeroTech team to integrate the business and unlock value for our customers and shareholders,” Pfeifer said.
According to a news release, the acquisition is expected to close in the third quarter of 2023, subject to regulatory approval and customary closing conditions. Oshkosh expects to fund the transaction through a combination of cash on hand and capacity under its current revolver.
