AeroEngine Component Manufacturer Due Diligence
A leading Pan-European private equity firm, with significant investments in industrials and other sectors, was evaluating an investment in a supplier of aeroengine components and sought the advice of a qualified and experienced aviation advisory firm to provide an independent, expert opinion on the commercial aeroengine market.
Leveraging its domain expertise, Alton provided the client with a comprehensive analysis of the commercial aerospace value chain through a three-phased analysis:
- Market Assessment: Alton performed a in-depth forecast of commercial aircraft and engine fleet, with an assessment of Target’s share-of-wallet on new production equipment and detailed analysis of demand for Target’s specific component offerings, providing recommendations on priority markets and opportunities. The assessment included an analysis of demand, current and future trends, competitive landscape, pain points, adoption drivers, and pricing considerations for each technology solution.
- Aeroengine Supply Chain Analysis: Next, Alton provided an assessment of supplier critical success factors required to compete in the aeroengine piece part market and detailed competitive landscape analysis commercial aeroengine prime and sub-tier part suppliers.
- Technology Evaluation, Risks and Opportunities: Finally, we conducted a review new engine technologies and new programs, how current entry-into-service (EIS) issues impact OEM target production volumes, and assessed the likely strategies for each major engine OEM to evaluate the likelihood of Target’s success in the market.
Equipped with detailed addressable market forecasts and a strong understanding of the competitive landscape and technological trends shaping future market dynamics, our client was able to gain comfort with its investment thesis, enlist a second leading private equity firm as a potential co-investor, and make a competitive offer for the Target company.