The outlook for the commercial aerospace industry remains extremely positive and this is driving strong mergers and acquisitions activity, according to Michael Richter, managing director of the aerospace and defense group at financial advisor and asset manager Lazard. Richter said companies and investors are drawn to strong equity performance, revenues from healthy order backlogs and the perceived opportunity to get a bigger piece of the action at the early stage of an upcycle.
Despite the mounting prospect of another full-blown financial crisis in Europe and diminished airline profitability in many regions, Richter told AIN that companies throughout the aerospace supply chain are benefiting from the increased aircraft build rates announced by Airbus and Boeing in 2011. On top of this, he said the market has been reassured by an apparent end to the uncertainty surrounding the troubled Boeing 787 program and is now seeking to capitalize on opportunities presented by the new A320 neo and Boeing 737 MAX narrowbody developments.
