Cleveland-based TransDigm Group (NYSE: TDG ) is buying a piece of GE.
On Friday, as trading wound down for the week, TransDigm announced a deal to buy the Electromechanical Actuation Division of General Electric (NYSE: GE ) Aviation for $150 million, cash. The business, which makes proprietary, highly engineered aerospace electromechanical motion control subsystems for civil and military applications, counts all three of the world's biggest airplane manufacturers -- Boeing, Airbus, and Brazil's Embraer -- among its clients, and Sikorsky and General Atomics, as well, on the military side.
Annual revenues at the unit approximate $80 million, which puts about a 1.9 price-to-sales valuation on the transaction -- a significant discount to the 4.5 P/S ratio of TransDigm's own shares.
TransDigm intends to close the acquisition toward the end of Q3 2013, at which time it will rename the unit Whippany Actuation Systems, LLC.