TransDigm gets loan commitment to help fund $4 billion Esterline deal

By Susanna Moon

Chicago, Oct. 10 – TransDigm Inc. said it will incur new term loans and use about $2 billion of cash on hand to acquire Esterline Technologies Corp. for $4 billion, including the assumption of debt.

TransDigm entered into a definitive agreement to purchase all of the outstanding shares of common stock of Esterline for $122.50 per share in cash, which represents a premium of 38% to Esterline's closing price on Oct. 9, according to a company announcement.

TransDigm said it has obtained commitments for the full amount of financing required for the transaction.

“Immediately upon closing, the combined company will maintain the financial flexibility to meet any anticipated operating, acquisition and other opportunities that may arise though a combination of cash on hand, undrawn revolver, and under certain circumstances, additional availability under its credit agreement,” the release noted.

TransDigm is a Cleveland-based designer, producer and supplier of highly engineered aircraft components for use on commercial and military aircraft.

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