Global Fastener News

Aviall To Be Bought By Boeing

Jason Sandefur

Aviall Inc. signed an agreement to be acquired by The Boeing Co. for $1.7 billion cash plus the assumption of about $350 million in debt. Valued at $48 per share, the price represents a 27% premium to Aviall’s current stock value of $37.70 per share.
Headquartered in Dallas, Aviall distributes aerospace parts, including fasteners, to more than 19,000 government/military, general aviation/corporate and commercial airline customers, including over 300 airlines. Aviall markets and distributes products for approximately 220 manufacturers and offers approximately 700,000 catalog items. The company had 1,009 employees as of Dec. 31, 2005.
Aviall will keep its name and will operate as a wholly owned subsidiary of Boeing’s Commercial Aviation Services. Aviall’s 2005 revenue grew 30% to $1.3 billion, with more than 25% growth expected in 2006.
“We will now be able to bring our groundbreaking efforts to a much wider aerospace supply chain and thereby expand the number of suppliers whose products can benefit from our high level of customer service and supplier standards resulting in having more of the right parts in the right place at the right time,” stated Aviall CEO Paul Fulchino.
In addition to its distribution business, Aviall owns Inventory Locater Services, which operates electronic marketplaces for buying and selling parts, equipment and services for the global aviation, defense and marine industries. With more than 16,500 users in over 90 countries, ILS”s electronic marketplaces contain over 58 million line items representing over five billion parts for sale.
The deal, Boeing’s largest acquisition since the $27 billion purchase of McDonnell Douglas Corp. in the late 1990s, is expected to close during the third quarter of 2006. Boeing said it was looking to capture as much one-quarter of the growing $25 billion market for new aviation parts and services.
“This acquisition is uniquely powerful in that it leverages the strong and growing services units of both our commercial and military businesses,” commented Boeing CEO W. James McNerney.
“The aviation services market offers us tremendous opportunities to profitably grow our business, internally and externally, to better serve our commercial and military customers,” McNerney continued.
Boeing reported overall revenue of $54.8 billion in 2005, including roughly $9 billion from spare parts and services. Web: aviall.com or boeing.com �2006 FastenerNews.com