Will Buy Out Current Airline Shareholders

Global private equity firm The Carlyle Group announced this week it has reached an agreement to acquire ARINC Incorporated from its current shareholders, including several commercial airlines. The transaction is expected to close in the third quarter of 2007 subject to regulatory approval and other customary closing conditions.

"This is an important step in the evolution of ARINC," said John M. Belcher, Chairman and CEO of ARINC Incorporated. "We have worked very hard to find a partner who shares our vision, and believe that Carlyle's international presence, financial resources, and expertise in the aerospace, defense, and communications sectors will be instrumental in the continued expansion of our business. With the support of our dedicated and talented employees, ARINC is committed to maintaining the highest levels of customer service and industry leadership."

Though financial details were not disclosed, the Wall Street Journal reports the sale will likely result in a "small windfall" for ARINC's shareholders -- including American Airlines, Delta Air Lines, Northwest Airlines, Continental Airlines, United Airlines and US Airways. Combined, the airlines owned some 90 percent of ARINC.

Peter Clare, Carlyle Managing Director and Head of the Global Aerospace and Defense sector team, said, "We have long admired ARINC's leadership position and impressive track record of growth. We believe that ARINC is well positioned to capitalize on several favorable macro trends in both its commercial and government market segments."

Ian Fujiyama, the Carlyle Managing Director who led the transaction, added, "John and his team have successfully leveraged ARINC's unique domain expertise and technology leadership to offer innovative new solutions to its customers. We look forward to partnering with ARINC in continuing to build on its record of success."

Headquartered in Annapolis, MD, ARINC has approximately 3300 employees in 100 offices worldwide, generating annual revenues in excess of $900 million. The company has been the primary provider of communications technology to the nation's airlines for nearly 80 years. It also provides communications solutions to airports, and other aviation-related industries.

FMI: www.arinc.com, www.carlyle.com