ACQUISITIONS |
12 Months Ended |
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Sep. 30, 2026 | |
| Business Combination [Abstract] | |
| ACQUISITIONS | ACQUISITIONS Prince & Izant – On September 28, 2026, the Company completed the acquisition of 99% of the outstanding stock of Prince & Izant (“P&I”) for approximately $1,058 million in cash, net of cash acquired. The definitive agreement to acquire P&I was entered into on July 27, 2026. The acquisition was financed using cash on hand. The remaining 1% of P&I equity interests continue to be owned by a member of P&I’s management team. Refer to Note 20, “Redeemable Noncontrolling Interests,” for further information. P&I, headquartered in Cleveland, Ohio, is a leading global designer and manufacturer of highly engineered brazing alloys and specialty metal components used across a range of advanced performance and high cost-of-failure applications. P&I primarily supports the aerospace and defense, aeroderivative turbine, and transportation end markets. Within aerospace and defense, select applications include aircraft engine fuel nozzles and rocket engines. Additionally, but to a lesser degree, P&I also serves the medical and general industrial end markets. P&I derives the majority of its revenue from the aftermarket and supports a large installed base globally. P&I’s products are highly proprietary in nature and support end customers through advanced metallurgy, precise chemistry requirements, and deep formulation expertise which are critical to supporting the evolving performance requirements in the markets which it serves. P&I has manufacturing locations in Cleveland, Ohio; Tinley Park, Illinois; Franksville, Wisconsin; and Bay Shore, New York. The operating results of P&I are included within TransDigm’s Power & Control segment. The Company accounted for the P&I acquisition using the acquisition method of accounting and included the results of operations of the acquisition in its consolidated financial statements from the acquisition date. The purchase price was allocated to the assets acquired, liabilities assumed and redeemable noncontrolling interests recognized based on their estimated fair values at the acquisition date. The excess of the purchase price and the fair value of the redeemable noncontrolling interests over the fair value of the net identifiable assets acquired was recorded as goodwill. The allocation is preliminary. As of September 30, 2026, the measurement period (not to exceed one year from the acquisition date) is open. The Company is in the process of obtaining a third-party valuation of the other intangible assets and the redeemable noncontrolling interests and of finalizing working capital and income taxes. The amounts recognized are subject to adjustment until the end of the measurement period and the adjustments may be material. The preliminary allocation resulted in $627 million of goodwill and $410 million of other intangible assets. The other intangible assets consist of $198 million of technology (amortized over 20 years), $135 million of customer relationships (amortized over 20 years), $65 million of trademarks and trade names (indefinite-lived) and $12 million of backlog (amortized over 1 year). Of these amounts, $219 million of goodwill and $170 million of other intangible assets are expected to be deductible for tax purposes over 15 years. 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 $2,142 million in cash, net of cash acquired. 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 20, “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 10, “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 included the results of operations of the acquisition in its consolidated financial statements from the effective date of the acquisition. The total purchase price was allocated to the underlying assets acquired, liabilities assumed and redeemable noncontrolling interests recognized based upon their estimated fair values at the date of acquisition. The excess of the purchase price and the fair value of the redeemable noncontrolling interests over the fair value of the net identifiable assets acquired was recorded as goodwill. The Company has completed the valuation of the identifiable intangible assets and redeemable noncontrolling interests, which was performed with the assistance of a third-party valuation specialist. The allocation remains preliminary and is subject to adjustment during the measurement period, which will not exceed one year from the acquisition date, as the Company finalizes income taxes and certain other assets and liabilities. The Company does not expect material changes to the allocation. During the fourth quarter of fiscal 2026, the Company recorded measurement period adjustments, primarily as a result of the completion of the third-party valuation and related impact on deferred tax liabilities, that increased goodwill by a net amount of $47 million. The adjustment to goodwill was a result of an increase to deferred income tax liabilities of $90 million, partially offset by an increase to other intangible assets of $43 million. The related effect on amortization expense was not material. The remaining measurement period adjustments recorded were not material. The allocation resulted in $1,183 million of goodwill and $996 million of other intangible assets. The other intangible assets consist of $625 million of customer relationships (amortized over 20 years), $280 million of technology (amortized over 20 years) and $91 million of trademarks and trade names (indefinite-lived). Of these amounts, $753 million of goodwill and $707 million of other intangible assets are expected to be deductible for tax purposes over 15 years. 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, net of cash acquired. 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 Company completed its allocation of the fair value of the assets acquired and liabilities assumed for the Simmonds acquisition. The final allocation resulted in $370 million of goodwill and $425 million of other intangible assets. 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 are deductible for tax purposes over 15 years. 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, net of cash acquired. The acquisition 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. The Company completed its allocation of the fair value of the assets acquired and liabilities assumed for the Servotronics acquisition. The final allocation resulted in $76 million of goodwill and $46 million of other intangible assets, none of which are deductible for tax purposes. Other Acquisitions – For the fiscal year ended September 30, 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 $434 million in cash, net of cash acquired. Each of the acquisitions was financed using cash on hand. These acquisitions represent bolt-ons to existing TransDigm operating units. Of the $176 million of goodwill recognized, $112 million is expected to be deductible for tax purposes over 15 years. Of the $134 million of other intangible assets recognized, $95 million is expected to be deductible for tax purposes over 15 years. As of September 30, 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 consolidated financial statements. On September 21, 2026, the Company announced that its operating unit, Extant Aerospace, entered into a definitive agreement to acquire certain assets comprising a portfolio of commercial rotorcraft, land systems and business jet products, including a manufacturing facility located in California, for approximately $240 million in cash. The acquisition is expected to close during fiscal 2027, subject to standard regulatory approvals and the satisfaction of customary closing conditions. 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, net of cash acquired. Each of the acquisitions was financed using cash on hand. These acquisitions represent bolt-ons to existing TransDigm operating units. All of the approximately $147 million of goodwill and $90 million of other intangible assets recognized for the acquisitions are deductible for tax purposes over 15 years. * * * * * Pro forma net sales and results of operations for the acquisitions, had they occurred at the beginning of the fiscal years ended September 30, 2026 or September 30, 2025 are not material. Net sales and results of operations for the fiscal 2026 acquisitions included in the consolidated statements of income for the fiscal year ended September 30, 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 earnings and cash flows, as well as the future earnings 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.
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