Commercial aviation OEM supply chain business owners may have to postpone retirement yet again. It seemed that things would be different. When the COVID-19 pandemic arrived in early 2020, I knew merger and acquisition (MA) activity would plummet. But I made three other important assumptions, all of which were misplaced.According to PitchBook Data, MA volume in commercial aviation was down more than 65 in 2020 and 2021 from pre-pandemic levels. Anecdotal experience indicates that it was down much more for the sector's privately held companies.While I was correct in my prediction that MA activity in the commercial aviation industry would decline, my other predictions proved to be very wrong. First, I assumed many privately owned middle market OEM suppliers would quickly go bankrupt, as demand plummeted. Second, I assumed that eventually the pandemic would become endemic and, as it did, passenger travel would recover. Then, the privately owned suppliers to Airbus and Boeing that did not go bankrupt would quickly return to financial health. Third, based on that assumption, I surmised that sometime around late 2022 (assuming COVID-19 became endemic), aging owners of privately held suppliers would be able to return to the market to sell their businesses and facilitate their retirements, after a two-year delay.
展开▼
