Hexcel To Acquire ARC Technologies

STAMFORD, Conn. — November 30, 2018 — Hexcel Corp. announced today that it has entered into a definitive agreement to acquire ARC Technologies Inc., a supplier of custom RF/EMI and microwave absorbing composite materials for military, aerospace and industrial applications. The acquisition strengthens Hexcel’s existing advanced materials portfolio in structural composites and thermoplastics and provides new opportunities for growth and market penetration.

ARC Technologies, founded in 1988, is a privately-owned manufacturer with about 170 employees working at two locations in Amesbury, Mass. The company has a wide range of capabilities for producing RF/EMI and microwave absorbing materials and specializes in combining absorptive metallic filler compounds — including carbon, iron and nickel-coated graphite — with a proprietary blend of polymer resins to generate various matrix materials including structural composites and thermoplastics.

Hexcel Chairman, CEO and President Nick Stanage said: “ARC Technologies is a leader in materials science with talented people and a culture that is a strong fit with ours. This acquisition will combine two great research and technology teams to further develop next-generation products for both commercial and military aerospace and defense applications. Both companies are committed to maintaining strong customer relationships focused on innovative solutions so we will be well positioned to grow and enhance the business.”

ARC Technologies Founder & CEO Daniel P. Healey, III, said: “This acquisition represents a major step in strengthening our capabilities in RF absorbing materials, thermoplastic products and specialty composites. Hexcel has a well-known industry reputation for producing high-performance structural materials, so the acquisition will improve our ability to offer the next generation of aerospace materials and advanced composites to our customers. Knowing Hexcel’s corporate credibility and culture, I’m confident that the acquisition will benefit both companies and all of our employees.”

ARC Technologies is expected to generate about $50 million in revenue in 2018. The agreed-upon purchase price is $160 million, which represents a multiple of 11.9 times 2018 expected adjusted EBITDA. The transaction is expected to be accretive to Hexcel’s earnings in 2019 and is subject to customary commercial and regulatory conditions and approvals. It is expected to close early in 2019.

Posted December 6, 2018

Source: Hexcel Corp.