Published on 22 Sep 2021 on Zacks via Yahoo Finance

Parker-Hannifin's (PH) Deal to Acquire Meggitt Gets Approval

Parker-Hannifin Corporation PH yesterday announced that the terms of its recommended acquisition of Meggitt PLC have been approved by the latter’s shareholders. In August 2021, the company entered into an agreement to acquire Meggitt’s all issued and to be issued ordinary share capital in cash.Parker-Hannifin’s shares declined 1.9% yesterday to eventually close the trading session at $279.47.Headquartered in Coventry, the U.K., Meggitt is a leading provider of aerospace and defense motion and control technologies. The company, which employs more than 9,000 people globally, generated annual revenues of about $2.3 billion in 2020.

Inside the Headlines

The Meggitt acquisition, which is in sync with Parker-Hannifin’s Win Strategy, is expected to strengthen the company's engineered aerospace offerings across the aerospace and defense end markets. The company expects the addition of Meggitt’s strong research and development capabilities, skilled workforce, and solid operational practices to enhance its shareholder value.The completion of the transaction, which is subject to certain regulatory clearances, is anticipated to take place in third quarter of calendar 2022.Meggitt will be integrated into Parker-Hannifin’s Aerospace Systems segment. This segment designs and manufactures aerospace products and provides aftermarket support to commercial, business jet, military, and general aviation aircraft and missile end markets. The segment generated revenues of $630 million, accounting for 15.9% of net revenues in fourth-quarter fiscal 2021 (ended June 2021).A couple of other notable buyouts made by Parker-Hannifin in fiscal 2020 (ended June 2020) are Exotic Metals Forming Company and LORD Corporation. The company did not acquire any assets in fiscal 2021. Acquired assets boosted the company’s sales by $394.1 million in fiscal 2021.