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TransDigm acquisition agreement with Aerosonic

TransDigm acquisition agreement with Aerosonic, TransDigm Group Inc. and Aerosonic Corp. announced Monday a definitive merger agreement, providing for Aerosonic to become an indirect wholly owned subsidiary of TransDigm. TransDigm and Aerosonic both design, manufacture and supply aircraft components.

Under the terms of the agreement, TransDigm will offer to acquire all of the outstanding shares of Aerosonic for $7.75 per share in cash in a transaction valued at approximately $39 million on a fully-diluted basis. The transaction will be funded with TransDigm's cash on hand and is not subject to any financing condition.

Aerosonic designs and manufactures, proprietary air data sensing, test and display components for use primarily in the business jet, helicopter and military markets. Major customers include the U.S. government and Boeing. About 55 percent of total revenue is derived from the commercial market and 60 percent from the aftermarket.

“The proprietary nature of these products, along with aftermarket content, fit well with our overall business strategy,” said W. Nicholas Howley, chairman and chief executive officer of TransDigm.

TransDigm is a leading global designer, producer and supplier of aircraft components for use on nearly all commercial and military aircraft in service today.

“This merger will allow Aerosonic to leverage its proprietary air data and display technologies via TransDigm's broad market presence and financial strength, enhancing the growth prospects of the TransDigm team,” said Doug Hillman, Aerosonic's president and CEO.

Under terms of the merger agreement, the parties anticipate TransDigm will commence a tender offer for all of the outstanding shares of Aerosonic on or before May 9. The tender offer will not be closed until conclusion of the "go shop" period described below. TransDigm's obligation to accept and purchase Aerosonic common shares tendered pursuant to the offer will be subject to customary closing conditions, including valid tender of common shares representing at least a majority of Aerosonic's voting power on a fully-diluted basis. If the first-step tender offer is successfully completed, TransDigm will acquire any of the Aerosonic common shares not tendered in the tender offer through a second-step merger transaction.

As contemplated by the merger agreement, Aerosonic, with the assistance of its independent advisors, will solicit superior proposals from third parties during the next 40 days. Aerosonic does not anticipate disclosing any developments regarding this process unless and until its Board of Directors makes a decision with respect to a potential superior proposal. There is no assurance that this process will result in a superior proposal. TransDigm will terminate its tender offer if Aerosonic accepts a superior proposal and terminates the merger agreement in accordance with its terms.

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