There is an expectation for the Pentagon and NASA to implement budget cuts in the near future. This budget cut is prompting aerospace companies across the U.S. to merge in preparation for an industry competing for lesser contracts. In the first quarter of this year, there were 56 merger and acquisition deals announced, according to Irvine, Calif. aerospace investment bank Janes Capital Partners. This was a 14 percent increase from last year.
“We are on the cusp of a major merger wave in aerospace and defense,” said Stephen Perry, managing director at Janes. “As budgets decline, it’s very logical for these firms to go out looking for ways to combine businesses.”
According to Tom Captain, in Deloitte’s 2014 global aerospace and defense industry outlook, the commercial aerospace supply chain will consolidate in the next few years.