Shaking the Giant’s Hand

Founded in 1988, Exton, Pennsylvania-headquartered Innovative Solutions & Support (IS&S) is a designer and manufacturer of navigational and flight-control systems for the aerospace industry.

On 10 July 2023, IS&S announced it had entered into an exclusive licensing agreement with Honeywell International by which it will acquire key assets specific to a number of the aerospace technology giant’s communication and navigation products.

IS&S CEO Shahram Askarpour stated: "We are pleased to announce the exclusive licensing of these product lines from Honeywell Aerospace. This is a unique opportunity that enhances our current offerings in the Air Transport, Military and Business Aviation markets.”

Mr. Askarpour continued: “In addition, there are potential cost synergies from leveraging our skilled engineering team and better utilizing existing operational capacity in Exton. We also believe this agreement can help to accelerate growth of the IS&S franchise by enhancing our global reputation for delivering some of the industry’s best price-for-performance value propositions.”

Under the new asset purchase and license agreement, IS&S will license the exclusive Intellectual Property (IP) rights to manufacture, upgrade, and repair certain Honeywell Inertial Navigation System (INS), communication, and navigation products. The purchased assets include existing inventory as well as test, tooling, and other equipment germane to the manufacture, repair, and upgrade of the aforementioned products.

IS&S chief financial officer Mike Linacre set forth: “These product lines have attractive margin profile characteristics that are an essential element of our strategy. Consequently, once they’ve been integrated into our operations, we expect the transaction to materially contribute to our revenues and EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization). We also expect the resulting EPS (Earnings Per Share) to be accretive in fiscal 2024, with the potential for additional net income increases in future years from various synergies.”

Mr. Linacre concluded: “Coincident with this acquisition, IS&S has secured bank facilities to maintain ample liquidity for ongoing operations and potential future acquisitions. These facilities and cash on hand were used to fund the total purchase price for the transaction.”

IS&S is a diversified international supplier to the commercial, military, and business aviation markets. The company’s products include: integrated avionics suites, Flight Management Systems (FMS), flat-panel primary and flight navigational displays, autothrottles, engine instrument displays, mission displays, integrated standby units, advanced GPS and RNP navigation systems, and precision air-data instruments.

FMI: https://innovative-ss.com