Thales has entered into an exclusive negotiation to acquire Cobham Aerospace Communications (AeroComms), a supplier of advanced, ultra-reliable innovative safety cockpit communication systems, for $1.1 billion.
With around 690 employees, of whom approximately 190 are engineers, the company operates across a well-invested footprint in France, South Africa, the US, Canada and Denmark. It is expected to generate around $200 million in revenues in 2023.
Thales is pursuing its strategy of strengthening its avionics portfolio, and this acquisition brings a global leader in safety cockpit communications, incorporating recently developed products benefitting from solid positions with major OEMs and strong aftermarket/retrofit opportunities.
“With the acquisition of Cobham Aerospace Communications and its highly skilled team of aerospace communications experts, and combined with our own critical avionics experts, Thales will establish a game changer in the very attractive and fast-growing communications and connectivity market to the benefit of a more sustainable aerospace future," says Thales EVP avionics Yannick Assouad. "By guaranteeing a cyber-secured, live connection between the cockpit and air traffic control, aircraft will be able to fly optimised trajectories in real time, significantly reducing fuel consumption and, consequently, CO2 emissions in the next two to three years.”
“This acquisition reflects the successful transformation of Cobham Aerospace Communications in recent years under Advent's ownership," says Cobham CEO Nicolas Bonleux. "Our sizeable investment in R&D over the last years has further consolidated our position as a leading player in our markets, with a series of new contracts won already this year.
"We are proud to join Thales, which will provide us with a platform to build on recent success, continue the development of several cutting-edge avionics products and ensure the business' future growth. The aircraft connectivity and communication markets will undergo a true revolution in the coming years, which will unlock potential for unique avionics products like ours. Our combined offering with Thales Avionics will enable us to further accelerate our contribution to safer, greener, more comfortable and more efficient air travel.”
AeroComms' product range includes full L-Band satcom systems (antennas and transceivers), complete digital audio and radio management solutions and passive antenna systems enabling connectivity, communications and navigation. The company is strongly positioned to benefit from the OEM's ramp up and wave of operating fleet retrofit opportunities. As part of its ongoing product development, AeroComms has recently developed game-changing products that will support future revenue growth: Aviator-S in satcom and DRAIMS in digital audio/radio.
By integrating AeroComms' safety cockpit communication systems portfolio, Thales will be ideally positioned to seize the opportunity of the shift towards connected cockpits. By the end of the decade, Thales will be able to fully address the permanent and secured connectivity needs of the aeronautical market.
This enhanced offering will enable Thales to provide customers with safer, affordable and sustainable solutions through:
- Real time and cyber-secured air-to-ground services
- Increased operations' efficiency (enabling eco-friendly/green flight, full spectrum cockpit connectivity etc)
- Better pilot assistance, paving the way to future autonomy solutions
- Reduced OEM's installation burden with integrated offers and reduced aircraft weight and drag (smart antenna)
The closing of the transaction is expected during the first half of 2024 upon customary merger control and regulatory approvals completions.