8-KMaterial AgreementsRegulation FDExhibits & Filings

TransDigm Group INC 8-K Report, Material Agreement (Jan 23, 2012)

Filed January 23, 2012For Securities:TDG

Summary

TransDigm Group Incorporated (TDG) has announced a significant acquisition through an Agreement and Plan of Merger with AmSafe Global Holdings, Inc. This transaction, valued at approximately $750 million in cash, involves TDG's purchase of AmSafe, a leading global supplier of safety and restraint equipment for the aerospace industry. The acquisition is expected to be financed through a combination of new senior bank debt, specifically a $500 million senior secured term loan facility with Credit Suisse and UBS, and existing cash reserves. This move signifies TDG's strategic intent to expand its presence within the aerospace sector by acquiring a well-established and innovative company. The deal is subject to customary closing conditions, including regulatory approval under the Hart-Scott-Rodino Act, and is anticipated to close before the end of the second fiscal quarter of 2012. Investors should note the disclosure of potential conflicts of interest, as affiliates of Berkshire Partners LLC hold stakes in both AmSafe and TDG, with a representative from Berkshire serving on TDG's board, though he recused himself from relevant deliberations.

Key Highlights

  • 1TransDigm Group (TDG) to acquire AmSafe Global Holdings, Inc. for approximately $750 million in cash.
  • 2AmSafe is a leading global supplier of safety and restraint equipment for the aerospace industry.
  • 3The acquisition is expected to be financed through a new $500 million senior secured term loan facility and cash.
  • 4Closing of the acquisition is subject to customary conditions, including HSR approval, and is expected by the end of Q2 fiscal 2012.
  • 5A potential conflict of interest was disclosed regarding Berkshire Partners' ownership in both companies and its board representation.
  • 6The transaction aligns with TDG's strategy to grow within the aerospace sector.

Frequently Asked Questions

TransDigm is acquiring AmSafe to strengthen its position in the global aerospace industry. AmSafe is described as a world-leading supplier of innovative, highly engineered, and proprietary safety and restraint equipment, suggesting a strategic fit to expand TransDigm's product offerings and market reach within the aerospace sector.

TransDigm plans to finance the acquisition through a combination of new senior bank debt and cash. Specifically, a commitment letter is in place for a $500 million senior secured term loan facility, with the remainder expected to be funded by existing cash resources.

Yes, the filing discloses that affiliates of Berkshire Partners LLC hold approximately 37.5% of AmSafe's equity and approximately 9.7% of TransDigm's equity. Additionally, a Managing Director of Berkshire serves on TransDigm's board of directors. This individual recused himself from discussions and voting on the AmSafe acquisition, mitigating direct involvement.

The acquisition is subject to customary closing conditions, including the termination of the waiting period under the Hart-Scott-Rodino Act. TransDigm expects the transaction to close before the end of the second quarter of fiscal 2012.