Combination To Expand Focus In Aerospace Market
Woodward Governor Company announced Tuesday it plans to acquire
aerospace electronics supplier MPC Products Corporation, in a
transaction valued at approximately $383 million.
MPC manufactures electromechanical motion control systems --
including high performance electric motors and sensors, analog and
digital control electronics, rotary and linear actuation systems,
and flight deck and fly-by-wire systems -- for a number of
commercial and military programs, for manufacturers including
Boeing, Bombardier, Raytheon, and Lockheed Martin.
That business will be spun off as a fourth Woodward business
segment, Airframe Systems.
"We anticipate that, together, Woodward and MPC will deliver
substantial benefits through an improved focus on aerospace energy
control solutions. MPC's actuation, motor, sensor, and electronic
capabilities complement our fluid energy and motion control
technologies and will improve our systems offerings," said Tom
Gendron, Woodward Chairman and CEO. "We believe our global
footprint will enhance MPC's business to achieve stronger growth
"Woodward is a very strong, active company. We feel the
combination of MPC and Woodward will give both companies an
opportunity for improved growth and expansion, and with Woodward's
support, MPC can further improve its leadership role in the
industry," said Joan Roberti, member of the MPC Board of
The acquisition is anticipated to be completed in October 2008.
Woodward expects to pay approximately $337 million at closing for
all outstanding shares and to repay MPC's outstanding debt, which
is currently $22 million. The company currently has a
$225 million credit facility in place, all of which is currently
The purchase does carry an additional stipulation. MPC is
currently under investigation by the US Department of Justice,
regarding the company's pricing practices for government contracts
prior to 2006. MPC has reached a financial settlement in principle
with the US Attorney for the Northern District of Illinois --
reflected in Woodward's purchase price for the company -- but
Woodward cautions the investigations continue, and "there can be no
assurance as to the resolution of these matters."