This week’s Farnborough International Airshow promises to be another busy one for dealmakers like Michael Richter, managing director and head of aerospace and defense with investment bank Lazard. Even compared with the periods around the 2012 Farnborough show and the 2013 Paris Air Show, he sees rising levels of mergers and acquisitions (M&A) activity in the commercial aerospace sector. He also anticipates some degree of recovery in defense industry M&A activity, reversing a period of relative inactivity in a sector that has been impacted by uncertainty over military budgets.
According to Lazard, commercial aerospace M&A is being driven largely by the quest for consolidation in the supply chain and greater certainty over positive build rates for products. Visibility–meaning a high degree of certainty–over airliner build rates is a key factor supporting the bullish M&A environment surrounding airliner manufacturers and their suppliers.
