TransDigm to Buy Stellant Systems for $960M & Expand Product Portfolio

TransDigm Group, Inc. TDG recently revealed that it has inked an agreement to acquire Stellant Systems, Inc., a portfolio company of Arlington Capital Partners. The transaction is worth nearly $960 million in cash, including certain tax benefits.

How Will the Buyout Benefit TransDigm Stock?

Stellant Systems’ advanced high-power electronic components and subsystems are expected to help TransDigm expand its product portfolio and strengthen its presence across the global aerospace and defense markets. Stellant’s highly engineered, proprietary offerings support critical aircraft and defense applications, reinforcing TransDigm’s position as a key supplier of mission-critical components that enhance aircraft performance, reliability and safety.

The acquisition of Stellant Systems aligns well with TransDigm’s long-term strategy of acquiring proprietary aerospace businesses with strong aftermarket exposure. Nearly half of Stellant’s revenues are generated from the aftermarket. The deal is likely to enhance TransDigm’s revenue base, improve cash flow and support its margin profile while expanding market share across major commercial and defense platforms.

With aging aircraft fleets and continued defense modernization driving sustained demand for maintenance, repair and overhaul services, aftermarket-rich components remain in high demand. This will support long-term revenue growth by offering specialized, high-value electronic solutions to aerospace and defense customers.

Acquisition Spree Among Aerospace Defense Players

The aerospace and defense sector has seen a surge in merger and acquisition activity in recent times, fueled by a greater emphasis on cost optimization and the need to diversify product portfolios amid intensifying competition. Such deals are increasingly vital for strategic growth, allowing companies to scale operations, gain specialized capabilities, advance technologies, and deliver higher-value products and services to strengthen their competitive positioning and expand market share.

Along with TDG, other aerospace-defense companies have recently indulged in acquisition deals, as discussed below:

In December 2025, HEICO Corporation’s HEI Flight Support Group subsidiary, Wencor Group, LLC, signed an agreement to acquire EthosEnergy Accessories and Components Limited and EthosEnergy Accessories and Components, LLC.

HEI has a long-term (three to five years) earnings growth rate of 16.50%. The Zacks Consensus Estimate for fiscal 2026 sales is pegged at $4.94 billion, which suggests an increase of 10.1%.

In December 2025, The Boeing Company BA completed the acquisition of Spirit AeroSystems. The deal covers all Spirit’s operations related to Boeing’s commercial programs, including 737 fuselages and major structures for the 767, 777 and 787 Dreamliner. It also encompasses commercially procured fuselages for the P 8 and KC 46 programs.

BA has a long-term earnings growth rate of 31.33%. The Zacks Consensus Estimate for 2026 sales stands at $94.72 billion, which calls for a rise of 8.6%.

In December 2025, AAR Corp. AIR inked an agreement to acquire Aircraft Reconfig Technologies from ZIM Aircraft Cabin Solutions for $35 million. The acquisition is expected to expand AAR’s engineering and certification capabilities in its Repair & Engineering segment. 

The Zacks Consensus Estimate for fiscal 2026 earnings per share is pegged at $4.72, which suggests an increase of 20.7%. The Zacks Consensus Estimate for fiscal 2026 sales stands at $3.14 billion, which indicates a rise of 12.9%.

TDG Stock Price Movement

In the past three months, shares of TransDigm have gained 3.2% against the industry’s 1% decline.

TransDigm’s Zacks Rank

TDG currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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