TransDigm Group Incorporated Seeks M&A Opportunities
February 08, 2024 at 11:00 am EST
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TransDigm Group Incorporated (NYSE:TDG) is looking for M&A opportunities. President and Chief Executive Officer, Kevin Stein said during the Fiscal 2024 First Quarter Earnings Conference Call, "Regarding the current M&A pipeline, we continue to actively look for M&A opportunities that fit our model. As we look out over the next 12 to 18 months, we continue to see a target-rich environment for our focused acquisition strategy.
As usual, the potential targets are mostly in the small and midsize range. I cannot predict or comment on possible closings, but we remain confident there is a long runway for acquisitions that fit our portfolio. The capital allocation priorities at TransDigm are unchanged.
Our first priority is to reinvest in our business; second, do accretive disciplined M&A; and third, return capital to our shareholders via share buybacks or dividends. A fourth option paying down debt seems unlikely at this time, though we do still take this into consideration. We are continually evaluating all of our capital allocation options, but both M&A and capital markets are difficult to predict.
As always, we continue to closely monitor the capital markets and remain opportunistic".
TransDigm Group Inc. specializes in the design, manufacturing and marketing of aerospace systems and components. Net sales break down by family of products as follows:
- engine components and control systems (50.3%): mechanical and electromechanical actuators and control systems, pumps and engine control systems, power regulators, ignition systems, thermal management systems, fluid management systems, batteries and power supply systems, motion sensors, data recording, analysis and processing systems, etc. The group also offers winches, lifting systems and cargo handling systems;
- cabin systems and equipment (47%): cockpit safety components and systems, locking systems and devices, connectors, audio control systems, specialized sanitary equipment, seat belts and safety devices, interior fittings (seats, display systems, on-board entertainment systems, etc.) lighting systems, parachutes, freight delivery systems, etc. ;
- other (2.7%): non-aeronautical systems and equipment.
At the end of September 2023, the group operated approximately 100 production sites worldwide.
The United States accounts for 64.8% of net sales.
TRANSDIGM GROUP INC. 
