KippsDeSanto & Co. advises Systron Donner Inertial, Inc. on its Sale to Investment Affiliates of Resilience Capital Partners

KippsDeSanto & Co. is pleased to announce the sale of its client, Systron Donner Inertial, Inc. (“SDI” or the “Company”), a portfolio company of The Carlyle Group, PAI Partners, and Schneider Electric, to investment affiliates of Resilience Capital Partners.

Headquartered in Concord, CA, SDI is a leader in the inertial sensors industry, with considerable domain expertise in the design and development of high performance, precision, quartz microelectromechanical systems (“QMEMS”). SDI’s QMEMS are utilized in guidance, navigation, control, and stabilization applications for various aircraft, unmanned autonomous vehicles, land vehicles, and precision guided weapons. QMEMS provides clear, continuously improving size, weight, power and cost (“SWaP-C”) advantages over alternative technologies. The Company’s product portfolio, anchored by its flagship SDI500 inertial sensor, includes a range of highly accurate, reliable, and resilient instruments used in many notable strategic platforms, including the Boeing 777x, MK48 / MK54 torpedoes, business jets, and military aviation and guided munitions programs.

We believe this transaction demonstrates several key trends in the aerospace and defense M&A environment:

• Companies holding single-source status on well-funded, mission-critical Programs of Record and enduring commercial platforms create compelling strategic interest as acquisition targets
• Significant value continues to be derived from companies with deeply-embedded relationships with key aerospace and defense customers, especially those aligned with favorable budget forecasts
• Private equity buyers remain actively focused on acquiring high-end design and manufacturing capabilities built on a foundation of proprietary processes and trade secrets

About KippsDeSanto & Co. KippsDeSanto & Co. is the largest independent investment banking firm exclusively focused on serving leading, growth-oriented Aerospace/Defense, Government Services and Technology companies. We are focused on delivering exceptional M&A and Financing transaction results to our clients via leveraging our scale, creativity and industry experience. We help market leaders realize their full strategic value. Having advised on over 100 industry transactions, KippsDeSanto is recognized for our analytical rigor, market insight and broad industry relationships. There’s no substitute for experience. For more information, visit www.kippsdesanto.com.

Press Release

Resilience Capital Partners Announces Acquisition of Systron Donner Inertial

March 26, 2019

CLEVELAND–(BUSINESS WIRE)–Resilience Capital Partners, a private equity firm that invests in middle-market companies, announced it has acquired Concord, California-headquartered Systron Donner Inertial. As the world’s leading supplier of quartz microelectromechanical systems (QMEMS) used in inertial sensing products that provide precision guidance, navigation and locational solutions, Systron Donner develops products that have been used in everything from business aircraft to fighter jets to the MARS Rover.

“Systron Donner is an important player in an industry that is critical to America’s future economic prosperity, leadership in aviation and national security,” said Steven H. Rosen, co-chief executive officer of Resilience Capital Partners. “Technology and innovation leadership is important for our nation’s future, and Systron Donner has been at the forefront of developing high-performing, made-in-America inertial sensors and systems for more than 50 years.”

Systron Donner’s QMEMS technologies are used in gyroscopes, accelerometers, inertial measurement units and inertial navigation system/GPS products that provide highly precise and reliable stabilization, geo-location, guidance, navigation and flight control solutions for aerospace, marine and land vehicles and systems.

Among the leading users of Systron Donner products are a leading defense contractor; a premier aerospace company; a civil and defense aerospace manufacturer; a leader in helicopter production; and a naval research agency. Systron Donner’s customers have frequently honored it for superior performance; in 2018, the firm received a leading defense contractor’s Supplier Excellence Award for the second consecutive time.

The future for such sensing products is highly promising. The market for inertial navigation systems alone is projected to grow from $9.54 billion in 2017 to $12.26 billion by 2022, a compound annual growth rate of 5.15 percent, according to an analysis by the business forecasting firm ResearchAndMarkets.

“Systron Donner’s proprietary technologies, the increasing size of the inertial sensing market and the company’s long history of relationships with a roster of blue-chip customers make this a company with strong potential,” said Rosen. “We look forward to working with the Systron Donner team to maximize this opportunity.”

The continued domestic development and manufacture of products for the aerospace and defense industries is seen as vital, given fears that a decline in American technology leadership could impair national security. Recent analyses, including a whitepaper authored by experts from the Institute for National Strategic Studies and a study prepared by a team assembled by the Office of the Director of National Intelligence and the U.S. Department of Homeland Security, have underscored these concerns.

An explanatory video about Systron Donner’s products is available on YouTube at https://youtu.be/6f1upekJbvE.

Terms of the transaction were not disclosed.

KippsDeSanto & Co. is pleased to announce the sale of the Power Manager business from Protonex (“Protonex”), a subsidiary of our client, Ballard Power Systems Inc. (NASDAQ: BLDP, “Ballard”) to Revision Military Ltd. (“Revision”).

Protonex designs and manufactures efficient, flexible power solutions for portable, remote, and military applications.  Protonex has deployed thousands of portable power solutions globally.  The Company’s products include both squad-based power manager systems, which can power any gear from any battery or charge any battery from any source, as well as man-wearable products which extend uptime of mission-critical devices and provide soldiers with full-power situational awareness.  In 2017, Protonex’s Squad Power Manager received signature approval for full rate production status, commonly known as “Milestone C” for the Mobile Soldier Power Program of Record.  This Program of Record includes a number of new devices focused on improving power and energy management on and around the soldier, including Protonex’s Squad Power Manager Kit (SPM-622), conformal wearable batteries, and man-worn power and data distribution devices, such as Protonex’s Vest Power Manager family.  Revision develops and supplies leading-edge protective equipment, including innovations in power management and integrated systems, for mission-critical military and tactical use.  The addition of Protonex to the Revision platform, along with planned increases in U.S. defense spending and achievement of Milestone C, creates significant synergies and a compelling growth opportunity for the combined business.

We believe this transaction demonstrates several key trends in the aerospace and defense M&A environment:

• Companies continue to employ M&A to shape and refine their portfolios to better align their capabilities along core competencies
• Buyers are focused on leveraging acquisitions to rapidly expand their existing product and solutions offerings
• Buyers are seeking to gain a foothold in programs of record with access to well-funded and difficult-to-penetrate customers

KippsDeSanto & Co. is an investment bank focused on delivering exceptional M&A and financing transaction results for leading aerospace, defense, and technology companies.  For more information on KippsDeSanto & Co., please visit www.kippsdesanto.com.

Press Release

VANCOUVER, BC, CANADA and SOUTHBOROUGH, MA, USA – Ballard Power Systems (NASDAQ: BLDP; TSX: BLDP) today announced that it has entered into a definitive agreement to divest certain non-core assets of its subsidiary, Protonex, related to the Power Manager business to Revision Military Ltd. (www.revisionmilitary.com), a private U.S.-based company, for up to $16.0 million in cash. Ballard will retain certain assets related to fuel cell propulsion systems for military and commercial unmanned vehicles.

Terms of the transaction include upfront consideration of $4.75 million to Ballard – payable in cash and note – subject to a customary working capital adjustment, and up to a further $11.25 million, based on achievement of specific sales objectives during a 12-month earn-out period. The transaction is expected to close within the next 60 days, subject to customary closing conditions.

Randy MacEwen, Ballard President and CEO said, “This divestiture is consistent with our strategy of continuous portfolio optimization. We decided to divest Protonex assets that are no longer aligned with Ballard’s strategic fuel cell focus, while retaining assets related to the unmanned vehicle market, under the Ballard brand. The divestiture reduces complexity while adding fuel for us to invest in our core fuel cell business.”

Mr. MacEwen continued, “We originally acquired Protonex to provide strategic diversification and to engage the U.S. military complex as a potential customer for portable fuel cell products. With the developing value proposition and attractive market opportunities for fuel cell electric vehicles or FCEVs in Heavy- and Medium-Duty Motive markets, including bus, truck, rail, marine and other applications, we are divesting the Power Manager business to focus on core fuel cell market opportunities. The Power Manager business is a good long-term business that better complements the Revision strategy.”

Jonathan Blanshay, CEO of Revision Military commented, “Revision is in the business of developing and supplying leading-edge protective equipment, along with innovations in power management and integrated systems, for mission critical military and tactical use. We are confident that our corporate platform, along with planned increases in U.S. defense spending and achievement of Milestone C, create a compelling growth opportunity for the Protonex Power Manager business.”

In 2015 Ballard paid approximately $17.5 million in shares and cash to acquire Protonex, which included the Power Manager business, a Solid Oxide Fuel Cells business which was divested in January 2018, and the unmanned vehicle business.

For additional information regarding unmanned vehicles, please visit http://www.ballard.com/markets/uav.

About Ballard Power Systems

Ballard Power Systems (NASDAQ: BLDP; TSX: BLDP) provides clean energy products that reduce customer costs and risks, and helps customers solve difficult technical and business challenges in power and energy. To learn more about Ballard, please visit www.ballard.com.

This release contains forward-looking statements concerning future events or developments, anticipated product performance, customer benefits and market demand for our products. These forward-looking statements reflect Ballard’s current expectations as contemplated under section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Any such forward-looking statements are based on Ballard’s assumptions relating to its financial forecasts and expectations regarding its product development efforts, manufacturing capacity, and market demand.

These statements involve risks and uncertainties that may cause Ballard’s actual results to be materially different, including general economic and regulatory changes, detrimental reliance on third parties, successfully achieving our business plans and achieving and sustaining profitability. For a detailed discussion of these and other risk factors that could affect Ballard’s future performance, please refer to Ballard’s most recent Annual Information Form. Readers should not place undue reliance on Ballard’s forward-looking statements and Ballard assumes no obligation to update or release any revisions to these forward looking statements, other than as required under applicable legislation.

This press release does not constitute an offer to sell or the solicitation of an offer to buy  securities. The Ballard Common Shares have not been registered under the United States Securities Act of 1933, as amended, or the securities laws of any other jurisdiction and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.

KippsDeSanto & Co. Advises GenNx360 Capital Partners on its acquisition of Precision Aviation Group, Inc.

KippsDeSanto & Co. is pleased to announce the acquisition by its client, GenNx360 Capital Partners (“GenNx360” or the “Company”) of Precision Aviation Group, Inc. (“PAG”), a portfolio company of PNC Riverarch Capital.  GenNx360 is a New York City-based private equity firm established in 2006 focused on acquiring middle market business services and industrial companies with proven and sustainable business models.

Headquartered in Atlanta, GA, with nine additional locations across the globe, PAG is a leading provider of maintenance, repair, and overhaul (“MRO”) and global supply chain network solutions for fixed and rotary-wing operations across a range of diverse end markets.  As the exclusive provider of its trademarked Inventory Supported Maintenance, Repair, and Overhaul (“ISMRO®”) capability focused on multi-site logistics and full lifecycle support, PAG delivers comprehensive support to varied general aviation, commercial, and military platforms.  In addition, the Company maintains its status as one of only a few companies, outside of Original Equipment Manufacturers (“OEM”), to collectively hold unlimited ratings granted by the Federal Aviation Administration (“FAA”).

The acquisition is expected to integrate GenNx360’s industry experience, OEM relationships, and operational expertise alongside PAG’s technical proficiency and talented management team to create new growth opportunities.   The partnership allows PAG to leverage GenNx360’s resources to enhance its current suite of products and services, providing PAG with multiple avenues to pursue growth within the aviation MRO services market.  Financial terms of the transaction were not disclosed.

We believe this transaction demonstrates several key trends in the aerospace and defense M&A environment:

• Highly-fragmented aviation aftermarket, including distribution of parts and MRO services, provides opportunistic buyers diverse and numerous opportunities to consolidate the industry through tuck-in acquisitions
• Significant value can be unlocked from acquisition targets with proprietary / differentiated technologies, such as Parts Manufacturer Approval (“PMA”) components and Designated Engineering Representative (“DER”) repairs
• Attractive aviation market fundamentals, driven in part by increasing traffic demand, utilization, and commercial fleet size, are expected to continue into the foreseeable future
• Sophisticated private equity buyers with intimate knowledge of target industries and explicit growth strategies can successfully compete against strategic buyers for coveted assets

Press Release 

GenNx360 Capital Partners (“GenNx360”), a New York-based private equity firm which invests in middle market business services and industrial companies is pleased to announce its acquisition of Precision Aviation Group, Inc. (“PAG” or the “Company”), effective July 26, 2018. PAG, established in 1993, is a leading provider of maintenance, repair and overhaul (MRO) and supply chain solutions for fixed and rotary-wing aircrafts serving diverse end markets.  Headquartered in Atlanta, Georgia, the Company operates out of nine locations in the United States, Canada, Australia, Brazil and Singapore.

“PAG is a leading provider of MRO services with a talented management team and a lot of growth potential.” said Daphne Dufresne, the GenNx360 Managing Partner who led the transaction. “PAG operates in a space that we know well and can add value through our industry relationships and operating initiatives.  We look forward to working alongside management to capitalize on future growth opportunities.”

David Mast, President & CEO of PAG, commented, “We are excited about partnering with GenNx360.  Their industry experience, OEM relationships, and operational expertise will allow us to quickly enhance our current suite of products and services.  Additionally, we are now poised to pursue the multiple avenues of growth available to us and expand on our mission of providing industry leading Aviation MRO services.”

Financial terms of the transaction were not disclosed.

About GenNx360 Capital Partners

GenNx360 Capital Partners is a private equity firm focused on acquiring middle market business services and industrial companies. We invest in companies with proven and sustainable business models in expanding industries with the objective of implementing the required operating changes to deliver cost efficiencies, accelerate growth, and generate strong financial returns. Target industries include industrial and environmental services, packaging, food and agricultural products and services, logistics and supply chain solutions, industrial machinery and components, infrastructure equipment and services, specialty chemicals, and aerospace and defense. GenNx360 was founded in 2006 and is headquartered in New York City. For more information on GenNx360 Capital Partners, please visit www.gennx360.com.

About Precision Aviation Group, Inc.

Precision Aviation Group (PAG) is a leading provider of products and value-added services to the worldwide aerospace and defense industry. With nine locations and more than 260,000-square-feet of sales and service facilities in the United States, Canada, Australia, Brazil, and Singapore, PAG uses its distinct business units and customer-focused business model to serve aviation customers through two business functions – Aviation Supply Chain, and its trademarked Inventory Supported Maintenance, Repair and Overhaul (ISMRO®) services. For more information on Precision Aviation Group, please visit www.precisionaviationgroup.com

For media inquiries about this press release, please contact:

GenNx360 Capital Partners

Carmen Rojas, Investor Relations Manager

Email: investorrelations@gennx360.com

Tel: 212.257.6772

KippsDeSanto & Co. is pleased to announce the sale of our client, Aitech Rugged Group (“Aitech” or the “Company”) to FIMI Opportunity Funds (“FIMI”).  Aitech is a leading supplier of rugged, hi-tech embedded computers for mission-critical aerospace, defense, and space programs worldwide optimized for harsh environments, in support of leading defense industry prime contractors and major global aerospace platform integrators.

Headquartered in Chatsworth, California, with operations in Herzliya, Israel, Aitech has established a reputation as a go-to supplier for advanced, high-performance, aerospace, defense, and space-qualified embedded computing and custom Commercial Off-The-Shelf Products (“COTS”) products used for Command, Control, Communications, Computers, Intelligence, Surveillance and Reconnaissance (“C4ISR”) and signal and sensor processing.  Aitech’s industry-leading engineering capabilities combine advanced, customized COTS, custom hardware, and software to provide integrated systems to meet evolving customer needs and mission requirements.   The Company’s unique customization model positions Aitech and its customers with the ability to continuously stay at the leading-edge of technological advancement, significantly reducing risk, time-to-market, and obsolescence for highly-visible, mission-critical programs.

The acquisition of Aitech provides FIMI with a well-established defense electronics platform and global customer base.  FIMI intends to make an immediate internal investment into Aitech to enable the Company to capitalize on increasing demand for its products and create a highly-scalable, market-dominant rugged embedded computing solutions provider.  The acquisition represents another step in FIMI’s plan to make investments in non-Israeli companies and centralize their operations in Israel.  Aitech represents the fourth investment made by FIMI since November 2017 in a series of defense electronics / satellite businesses.  FIMI plans to grow the Company’s business with a focus on business development, research, and sales and marketing initiatives.

We believe this transaction demonstrates several key trends in the aerospace and defense M&A environment:

• The global defense, aerospace, and space technology market remains robust as non-US firms continue to seek cross-border opportunities for strategic access
• High-end signal processing and computing systems for C4ISR mission and space platforms remains a key priority for buyers
• Companies with differentiated solutions and entrenched positions on key, well-funded platforms attract greater value in the M&A market

Press Release

August 02, 2018

Israel-based private equity firm FIMI Opportunity Funds is acquiring defense electronics company Aitech Rugged Group Inc. for $30 million, the firm announced Thursday.

Part of the sum will be used to buy Aitech from its current owners, a group of Netherlands-based investors, and the rest will be infused into the company to promote operational growth, the firm said in a statement.

About Aitech

Headquartered in Chatsworth, California, Aitech develops and manufactures commercial and military embedded computing solutions for the military and space industries. The company has several subsidiaries, including Aitech Systems Ltd., located in Tel Aviv suburb Herzliya, which employs 70 people out of Aitech’s 170 employees. The company reports annual revenues of $30 million-$40 million a year, and lists the Boeing Company and Lockheed Martin as customers.

In November 2017, Fimi acquired a controlling stake in Israel-based ORBIT Communication Systems Ltd., a company developing and manufacturing satellite communication systems, in Israel-based satellite imaging services company ImageSat International N.V., and in Israel-based Gilat Satellite Networks Ltd.

Fimi intends to support Aitech in both the financial and the administrative aspects, to bring the company’s full growth potential to fruition, said Fimi senior partner Gillon Beck, who led the acquisition, in a statement. The acquisition is another step in Fimi’s plan to make investments in non-Israeli companies and centralize their operations in Israel, Mr. Beck explained, adding that Fimi intends to unify Aitech’s various branches and relocate the center of its administration to Israel.

Aitech expects to see a significant increase in the scope of its operations in the next few years, CEO Moshe Tal said in a statement.

KippsDeSanto & Co. is pleased to announce the sale of BTP Systems, LLC (“BTP” or the “Company”) to Serco Inc (“Serco”).  BTP is a leading provider of design, engineering, manufacture, and sustainment of mission-critical satellite communications (“SATCOM”) terminals, radar systems, and other complex communications hardware, in support of the U.S. Navy, U.S. Air Force, and leading defense industry prime contractors.

Headquartered in Ludlow, MA, BTP offers a comprehensive suite of full lifecycle, end-to-end system capabilities, including systems engineering, design, prototype development, integration, testing, manufacturing, depot-level repair, and obsolescence engineering support, with expertise across shipboard and submarine SATCOM and MILSTAR terminals and antenna systems.  BTP operates one of the largest and most advanced near-field antennae ranges in the country, which, in addition to its compact antenna range, enables it to support a wide range of unique testing requirements.  With more than a decade of experience supporting nearly every Naval extremely high-frequency (“EHF”) and super high-frequency (“SHF”) SATCOM antenna system, such as SubHDR and Multiband Terminal, BTP has amassed considerable domain knowledge and expertise and has established a long-standing reputation in the industry as the go-to provider of complex technical SATCOM services.

The acquisition of BTP aligns well with Serco’s strategic growth objectives to expand capabilities and customer reach as BTP brings Serco critical new capabilities and additional U.S. defense customers.  In addition, Serco believes that the addition of BTP will position the combined company to take better advantage of the current demand for sustainment, overhaul, and testing services in the U.S. SATCOM marketplace.

We believe this transaction demonstrates several key trends in the aerospace and defense M&A market:

• Strategic buyers are actively focused on utilizing M&A to increase their exposure to the well-funded and growing U.S. defense market;
• Strategic buyers rely on M&A to add high-end and differentiated capabilities; and
• Buyers continue to place premium values on companies with entrenched and defensible positions with key customers on mission-critical programs.

Press Release

Serco Announces Agreement to Acquire BTP Systems

 RESTON, VIRGINIA – October 24, 2017 – Serco Inc., a provider of professional, technology, and management services, announced today that the Company has entered into a definitive agreement to acquire BTP Systems, LLC (“BTP”), headquartered in Ludlow, MA with operations or personnel in Newport RI, Reno NV, San Diego CA, Charleston SC, Groton CT, Norfolk, VA, Chesapeake VA, and Mayport FL.  The acquisition, subject to required approvals, is expected to close by the end of this year.

The proposed acquisition would support Serco’s strategic growth plan in the defense sector by enhancing its portfolio of Command, Control, Communications, Computers, Combat Systems, Intelligence, Surveillance and Reconnaissance (C5ISR) service offerings and broadening its Federal government client base.

BTP provides satellite communications (SATCOM), radar modernization, operations and maintenance, and sustainment services that enable customers to extend the lives of existing systems and achieve phased upgrades with new technology to enhance operational capability. BTP specializes in areas including obsolescence engineering, systems engineering services, test equipment and design, and field engineering services, and maintains a near-field and compact antenna test range at their Ludlow, MA headquarters. The company’s expertise spans shipboard and submarine SATCOM antenna systems, MILSTAR command post antennas, and radar antennas.

“BTP Systems is an excellent addition to our rapidly growing C5ISR business supporting naval modernization and sustainment for ship, shore, and hardware integration projects,” said Dave Dacquino, Chairman and CEO of Serco Inc. “This acquisition will provide Serco with capabilities in the engineering, overhaul, repair, and sustainment of SATCOM and radar systems that expand our scope of solutions for existing customers and brings Serco to new customers including Hill Air Force Base, the Naval Undersea Warfare Center, and Naval Air Systems Command.

The demand for sustainment, overhaul, and testing services is growing rapidly as many of the SATCOM and radar systems both on ships and on shore require significant upgrades and maintenance to extend their useful lives. BTP supports major SATCOM integrators with specialized RF engineering, small lot production, and RF testing services. Serco’s expertise in systems integration and large-scale modernization projects helps customers achieve goals for operational enhancement and timely and cost-effective completion with a high level of confidence.

Referring to the proposed acquisition, BTP Systems President and Founder Bud Beaudry commented, “Becoming a part of Serco will generate many immediate and long-term benefits to our customers and employees.  Our employees’ dedication to our customers has resulted in tremendous success throughout BTP’s 14-year history.  By joining with Serco, we will provide our clients even greater services, and will offer our employees additional opportunities for professional growth.  This is a great achievement for all involved as we join a company that has the scope, scale, and track record required for success, and a stellar reputation in the defense sector.”

About Serco Inc.

Serco Inc. is a leading provider of professional, technology, and management services. We advise, design, integrate, and deliver solutions that transform how clients achieve their missions. Our customer-first approach, robust portfolio of services, and global experience enable us to respond with solutions that achieve outcomes with value. Headquartered in Reston, Virginia, Serco Inc. has approximately 8,000 employees and annual revenue of $1 billion. Serco Inc. is a wholly-owned subsidiary of Serco Group plc, a $5 billion international business that helps transform government and public services around the world. More information about Serco Inc. can be found at www.serco-na.com.