ALEXANDRIA, Va. - VSE Corporation (NASDAQ: VSEC), a prominent provider of aftermarket distribution and repair services, has announced the signing of a definitive agreement to acquire Turbine Controls, Inc. (TCI), a leader in the maintenance, repair, and overhaul (MRO) market for aviation components. The acquisition, valued at approximately $120 million, is expected to close in the second quarter of 2024, subject to customary closing conditions.
The move is part of VSE's strategy to enhance its OEM authorized repair capabilities and expand its footprint in the high-growth aviation MRO market. TCI is recognized for its technical expertise and OEM-centric approach, with a 45-year history of excellence in servicing commercial, military, and general aviation markets. The acquisition is set to broaden VSE's MRO capabilities and market reach.
In addition to the acquisition, VSE has completed the divestiture of most assets in its Federal and Defense segment for $44 million. This is seen as a step towards simplifying the company's business structure. The company also announced the initiation of a strategic review process for its Fleet segment, which may result in a sale aimed at enhancing shareholder value.
VSE has pre-announced its preliminary financial results for the fourth quarter and full year of 2023, reporting revenues of approximately $235 million for the quarter and $860 million for the year. The company's GAAP net income is estimated to be around $13 million for the quarter and $43 million for the year. The preliminary results also indicate an Adjusted EBITDA of approximately $31 million for the quarter and $114 million for the year. However, these figures are subject to the completion of year-end closing processes and have not yet been audited.
Looking ahead, VSE has provided guidance for the full year 2024, projecting a revenue growth of 24% to 28% for the Aviation segment and an Adjusted EBITDA margin between 15% and 16%. The Fleet segment is expected to see revenue growth of 13% to 17% and Adjusted EBITDA growth of 8% to 12%.
The strategic actions and financial outlook presented by VSE Corporation are based on a press release statement and are forward-looking, subject to risks, uncertainties, and changes in circumstances that could affect the company's actual results and financial position.
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