Mergers and Acquisitions (M&A) in Aerospace, Defense, and Security 2020 – Thematic Research

In this report, we look at merger and acquisition (M&A) activity in the aerospace, defense, and security (ADS) sector over the year. We also highlight potential future bid targets in the sector. Current concerns are dominated by the impact of the COVID-19 pandemic on the sector. Financial stresses for companies have increased this year, with revenues slashed and immediate cashflow concerns taking priority over pre-COVID-19 strategies. That creates opportunities for M&A as companies fail or look to divest units in order to survive. Recessions act as catalysts for change. The scale of the economic shock and its impact on demand will have long-lasting consequences for the sector.

Scope

As the data shows, in the 12 months to December 2020 the value of acquisitions in the ADS sector was $18.6bn, with mergers valued at $8.7bn. While that acquisition sum is down on 2019's value of $101.016bn, the volume of transactions tracked by GlobalData was down on 2019. The largest completed M&A deal announced in 2020 was the Lockheed Martin acquisition of Aerojet Rocketdyne Holdings for $4.4bn, subject to closing in 2021.

Reasons to Buy

Our thematic investment research product, supported by our thematic engine, is aimed at senior (C-Suite) executives in the corporate world as well as institutional investors. This thematic report analyses strategy, regulatory, legislative and policy changes, driving technologies, and identifies the primary actors in this complex space. Covering the impact of the pandemic to the consequent strategies within this space, this report serves as a solid guide through the M&A landscape and explains the factors at play.

Corporations: Helps CEOs in all industries understand the disruptive threats to their competitive landscape. With the shifting regulations due to the economic fallout of the COVID-19 pandemic, this report provides corporations with valuable insights into legislative and regulatory changes in a number of geographies, and their impact on M&A in the ADS space. Identifying the driving themes, the short medium and long term strategies and impacts of the pandemic, its economic impact, and M&A activity, this report provides a useful, current and explanatory guide to corporations operating anywhere in the ADS value chains, informing this complex and dynamic sector.

Investors: Helps fund managers focus their time on the most interesting investment opportunities in global Aerospace & Defense. This report provides key insights into M&A strategy in critical technology areas for investment, such as hypersonic technologies, space systems, high intensity warfare, artificial intelligence, and robotics. Coverage of short term responses to the COVID-19 pandemic, Medium term impact and long term trends make this report a useful tool in understanding both the pandemic and post-pandemic landscape. With potential acquisition targets in coming years highlighted and explained, this report provides valuable information to investors throughout the value chains in ADS.

Whilst most investment research is underpinned by backwards looking company valuation models, GlobalData’s thematic methodology identifies which companies are best placed to succeed in a future filled with multiple disruptive threats. Our unique differentiator, compared to all our rival thematic research houses, is that our thematic engine has a proven track record of predicting winners and losers.