Eurocopter to Acquire Vector Aerospace Corporation

The Board of Directors of Vector Aerospace, after receiving the recommendation of the Special Committee, has unanimously approved the offer and has determined that it is in the best interests of Vector Aerospace for the offer to be made.


Eurocopter Holding, a subsidiary of EADS (EUR:EAD) and Vector Aerospace Corporation (TSX:RNO), a Canadian company listed on the Toronto Stock Exchange, have entered into a Support Agreement pursuant to which Eurocopter Holding will acquire all of the issued and outstanding common shares of Vector Aerospace by way of a take-over bid for consideration of C$13 in cash per Common Share (the Offer).

The Offer values Vector Aerospace equity at approximately C$625 million. Net debt was approximately C$3.1 million as at December 31st, 2010. The Offer price of C$13 per Common Share represents a premium of approximately 15% over the March 25th, 2011 closing price of the Common Shares on the TSX and a premium of approximately 80% over the closing price of the Common Shares on the TSX on December 2nd, 2010, being the last trading day before Vector Aerospace publicly announced that it was reviewing strategic alternatives to enhance shareholder value.

The Board of Directors of Vector Aerospace, after receiving the recommendation of the Special Committee, has unanimously approved the Offer and has determined that it is in the best interests of Vector Aerospace for the Offer to be made. Scotia Capital, exclusive advisor to Vector Aerospace’s Special Committee of Independent Directors, has provided the Board of Directors with a fairness opinion indicating that the consideration to be received by Vector Aerospace shareholders is fair from a financial point of view. In addition, shareholders holding approximately 60% of the issued and outstanding Common Shares have entered into irrevocable lock-up agreements with Eurocopter Holding under which they have agreed to tender their Common Shares to the Offer.

Vector Aerospace, a leading provider of multi-platform helicopter maintenance, repair and overhaul (MRO) services and of rotary and fixed-wing aircraft engine repair & overhaul, will become Eurocopter Holding’s independent multi-platform MRO services provider. Vector Aerospace, which employs some 2,500 persons, is principally located in Canada and the United Kingdom, and enjoys an important presence in the United States and South Africa. Vector Aerospace will maintain and develop its world-renowned brand name. In 2010, Vector Aerospace generated a turnover of 545 million Canadian dollars (400 million euros) – roughly the equivalent of a quarter of Eurocopter’s current Support and Services turnover (1.7 billion euros).

The acquisition of Vector Aerospace constitutes a key step towards the achievement of EADS’ strategic goals – Vision 2020. This acquisition is a catalyst for the growth of Support & Services with a focus on the high end segment and the servicing of multi-customer platforms both in the civil and governmental markets. Vector Aerospace will also strengthen EADS’ presence in North America, improving the natural $ hedge. The robust and proven operational and financial performance of Vector Aerospace will support EADS’ EBIT targets.

Already present in the small engine MRO segment through its SECA holding, EADS will be able to improve its commercial and geographical coverage as well as enhance its service offering in that field.

Completion of the transaction will enable Eurocopter to capitalize on its own commercial network together with Vector Aerospace’s offering in order to position itself as a leading global multi-platform service provider with an extended presence in North America and the UK. Vector Aerospace will benefit from Eurocopter’s global footprint and presence in 25 countries to develop in fast growing markets such as Asia and Latin America.

This content continues onto the next page...

We Recommend