Precision Castparts [PCP] on Sunday said that it has agreed to acquire Klune Industries in a deal that expands its capabilities in the aerostructures market for commercial and military products.
Terms of the deal, which is expected to close by the end of this year subject to regulatory approvals, were not disclosed although Precision Castparts said the transaction will be paid in cash. The acquisition is expected to be immediately accretive to earnings.
Precision Castparts has been saying that it will continue expanding into aerostructures components. A company spokesman told Defense Daily that Klune has little overlap with Precision Castparts.
“Klune expands our reach into the widely fragmented aerostructures market,” Mark Donegan, chairman and CEO of Precision Castparts, said in a statement. “Klune also offers significant synergies with our existing operations. Klune’s sheet metal and fabrication capabilities will be a major addition to our aerostructures product offering. The company purchases castings, forgings, and fasteners, which can now be supplied internally, and their expertise in machining castings adds to the capabilities of our aerostructures companies.”
Klune’s sales were not disclosed but about 60 percent of the company’s business is for commercial aircraft and the rest military. The amount of commercial business is expected to increase over the next few years, the spokesman said.
Donegan also said that the pending acquisition will increase his company’s “dollar content” on Boeing’s [BA] 787 commercial jetliner program. He also said that Klune has “solid positions” on Boeing’s 737 aircraft and the General Dynamics [GD] Gulfstream G650 business jet.
Klune’s products are also on AH-64 Apache attack helicopters, Guided Multiple Launch Rocket Systems, the Joint Air-to-Surface Standoff Missile and Stinger missiles.
Klune’s aerostructures are made of aluminum, nickel, titanium and steel.
Klune, which is based in California, has about 740 employees. Klune will report within Precision Castparts’ Fastener Products segment.