ACQUISITIONS |
9 Months Ended |
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Jun. 27, 2026 | |
| Business Combination [Abstract] | |
| ACQUISITIONS | ACQUISITIONS Jet Parts Engineering and Victor Sierra Aviation Holdings – On April 7, 2026, the Company completed the acquisition of 95% of the outstanding stock of Jet Parts Engineering (“JPE”) and 96% of the outstanding stock of Victor Sierra Aviation Holdings (“VSA”) for approximately $2.2 billion in cash. The definitive agreement to acquire JPE and VSA was entered into on January 13, 2026. The remaining 5% and 4%, respectively, of JPE and VSA equity interests continue to be owned by certain members of JPE’s and VSA’s management teams. Refer to Note 14, “Redeemable Noncontrolling Interests,” for further information. The acquisition was financed using cash on hand and the net proceeds from the debt offerings completed in February 2026 (refer to Note 8, “Debt,” for further information). JPE, headquartered in Seattle, Washington, is a leading independent designer and manufacturer of aerospace aftermarket solutions, primarily proprietary original equipment manufacturer (“OEM”) alternative parts and repairs. JPE serves commercial, regional and cargo airline customers, as well as maintenance, repair and overhaul providers. JPE’s products are highly engineered, proprietary parts manufacturer approval (“PMA”) components with a strong presence across major commercial aerospace platforms. VSA is a leading designer, manufacturer, and distributor of proprietary PMA and other aftermarket parts serving the commercial aerospace end market – primarily the general aviation and business aviation sectors. VSA is a leading collection of brands including McFarlane Aviation, Tempest Aero Group, and Aviation Products Systems. VSA offers a complete line of highly engineered PMA, custom design and OEM products, as well as service and repair stations. Nearly all of JPE’s and VSA’s sales are derived from the commercial aftermarket. The operating results of JPE and VSA are included within TransDigm’s Power & Control segment. The Company accounted for the JPE and VSA acquisition using the acquisition method of accounting and a third-party valuation appraisal and included the results of operations of the acquisition in its condensed consolidated financial statements from the effective date of the acquisition. The total purchase price was allocated to the underlying assets acquired and liabilities and redeemable noncontrolling interests assumed based upon the estimated fair values at the date of acquisition. To the extent the purchase price exceeded the fair value of the net identifiable tangible and intangible assets acquired, such excess was allocated to goodwill. These amounts reflect various preliminary fair value estimates and assumptions, including preliminary work performed by a third-party valuation specialist, and are subject to change within the measurement period as the valuation is finalized. The allocation of the purchase price is preliminary and will likely change in future periods, perhaps materially, as fair value estimates of the assets acquired, particularly intangible assets, are finalized. Significant assumptions include the discount rates and certain assumptions that form the basis of the forecasted results of the acquired business including revenue, earnings before interest, taxes, depreciation and amortization (“EBITDA”), growth rates, royalty rates and technology obsolescence rates. These assumptions are forward looking and could be affected by future economic and market conditions. The fair value of the noncontrolling interests was determined using a Monte Carlo simulation and included the put and call options available pursuant to the purchase agreement. Refer to Note 14, “Redeemable Noncontrolling Interests,” for further information on the put and call options. The allocation of the estimated fair value of the assets acquired and liabilities and redeemable noncontrolling interests assumed has resulted in $1,134 million of goodwill and $953 million of other intangible assets recognized as of June 27, 2026. The other intangible assets consist of $601 million of customer relationships (amortized over 20 years), $268 million of technology (amortized over 20 years) and $84 million of trademarks and trade names (indefinite-lived). $1,085 million of the acquired goodwill and $898 million of the acquired other intangible assets are expected to be deductible for tax purposes over 15 years. As of June 27, 2026, the measurement period (not to exceed one year) is open; therefore, the assets acquired and liabilities and redeemable noncontrolling interests assumed related to the acquisition of JPE and VSA are subject to adjustment until the end of the respective measurement period. Simmonds Precision Products, Inc. – On October 6, 2025, the Company completed the acquisition of all the outstanding stock of the Simmonds Precision Products, Inc. Business (“Simmonds”) of Goodrich Corporation for approximately $757 million in cash. The acquisition was financed using cash on hand. Simmonds, headquartered in Vergennes, Vermont, is a leading global designer and manufacturer of fuel & proximity sensing and structural health monitoring solutions for the aerospace and defense end markets. Simmonds’ products are highly engineered, proprietary components with significant aftermarket content and a strong presence across major aerospace and defense platforms. The operating results of Simmonds are included within TransDigm’s Power & Control segment. The allocation of the estimated fair value of the assets acquired and liabilities assumed has resulted in $331 million of goodwill and $425 million of other intangible assets recognized as of June 27, 2026. The other intangible assets consist of $219 million of technology (amortized over 20 years), $160 million of customer relationships (amortized over 20 years) and $46 million of trademarks and trade names (indefinite-lived). All of the goodwill and other intangible assets recognized for the acquisition are expected to be deductible for tax purposes over 15 years. As of June 27, 2026, the measurement period (not to exceed one year) is open; therefore, the assets acquired and liabilities assumed are subject to adjustment until the end of the measurement period. No adjustments are expected to be material to the condensed consolidated financial statements. Servotronics, Inc. – On June 2, 2025, the Company launched a tender offer to acquire all the issued and outstanding stock of Servotronics, Inc. (“Servotronics”), at a price of $47.00 per share in cash. On July 1, 2025, the tender offer expired, resulting in all issued and outstanding stock of Servotronics being canceled and Servotronics becoming a wholly owned subsidiary of the Company. The total purchase price was approximately $133 million in cash, which was financed through cash on hand. Servotronics, headquartered in Elma, New York, is a leading global designer and manufacturer of servo controls and other advanced technology components for aerospace and defense applications. Its products are highly engineered, proprietary components with significant aftermarket content and a strong presence across major aerospace and defense platforms. The operating results of Servotronics are included within TransDigm’s Power & Control segment. Based on the fair value of the assets acquired and liabilities assumed, $76 million of goodwill and $46 million of other intangible assets was recognized, none of which is deductible for tax purposes. Other Acquisitions – For the thirty-nine week period ended June 27, 2026, the Company completed several acquisitions consisting of substantially all of the assets and technical data rights of certain product lines or all the outstanding stock of certain businesses (collectively, referred to herein as the “Other Acquisitions”), each meeting the definition of a business, for a total aggregate purchase price of $257 million in cash. Each of the acquisitions was financed using cash on hand. These acquisitions represent bolt-ons to existing TransDigm operating units. Of the $111 million of goodwill recognized, $79 million is expected to be deductible for tax purposes over 15 years. Of the $93 million of other intangible assets recognized, $70 million is expected to be deductible for tax purposes over 15 years. As of June 27, 2026, the measurement period (not to exceed one year) is open for the fiscal 2026 Other Acquisitions; therefore, the assets acquired and liabilities assumed are subject to adjustment until the end of the respective measurement period. No adjustments are expected to be material to the condensed consolidated financial statements. For the fiscal year ended September 30, 2025, the Company completed a number of Other Acquisitions, each meeting the definition of a business, for a total aggregate purchase price of $284 million in cash. Each of the acquisitions was financed using cash on hand. These acquisitions represent bolt-ons to existing TransDigm operating units. The Company expects that all of the approximately $147 million of goodwill and $90 million of other intangible assets recognized for the acquisitions will be deductible for tax purposes over 15 years. As of June 27, 2026, the measurement period (not to exceed one year) is open for certain fiscal 2025 Other Acquisitions; therefore, the assets acquired and liabilities assumed are subject to adjustment until the end of the respective measurement period. No adjustments are expected to be material to the condensed consolidated financial statements. * * * * * Pro forma net sales and results of operations for the acquisitions, had they occurred at the beginning of the thirty-nine week periods ended June 27, 2026 or June 28, 2025 are not material. Net sales and results of operations for the fiscal 2026 acquisitions included in the condensed consolidated statements of income for the thirteen and thirty-nine week period ended June 27, 2026 are not material. The acquisitions completed by the Company strengthen and expand the Company’s position to design, produce and supply highly engineered proprietary aerospace components in niche markets with significant aftermarket content and provide opportunities to create value through the application of our three core value-driven operating strategy (obtaining profitable new business, continually improving our cost structure, and providing highly engineered value-added products to customers). The purchase prices paid reflect the current EBITDA As Defined and cash flows, as well as the future EBITDA As Defined and cash flows expected to be generated by the businesses, which are driven in most cases by the recurring aftermarket consumption over the life of a particular aircraft, estimated to be approximately 25 to 30 years. The primary items that generate the goodwill recognized are the premiums paid by the Company for the future earnings potential of the businesses acquired and the value of their assembled workforces that do not qualify for separate recognition. Subsequent Event – Stellant Systems, Inc. – On December 30, 2025, the Company entered into a definitive agreement to acquire all the outstanding stock of Stellant Systems, Inc. (“Stellant”) for approximately $960 million in cash. On July 13, 2026, the Company announced that it elected to withdraw from its proposed acquisition of Stellant. Subsequent Event – Prince & Izant – On July 27, 2026, the Company announced its definitive agreement to acquire all the outstanding stock of Prince & Izant for approximately $1.1 billion in cash. The acquisition is subject to regulatory approvals in the United States and customary closing conditions.
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