In the early 1990s, the Carlyle Group joined Northrop Grumman (NOC) to purchase Vought Aircraft Industries, a maker of aircraft structures. A few years later, Carlyle sold its half of the company to Northrop Grumman. Then in 2000, it bought the whole company from Northrup.

This week, Carlyle sold Vought yet again. The buyer is Triumph Group (TGI), which has agreed to purchase the company for $1.44 billion. The transaction consists of 7.5 million shares, $525 million in cash and the elimination of outstanding debt. As a result, Carlyle will wind up with 31% of Triumph.

Based on the market reaction, the deal looks like a win-win. In Tuesday's trading, the shares of Triumph are up more than 10%.

An Aviation Icon

Vought got its start back in 1917 and capitalized on the boom in aviation. However, over the years, the company would then be the subject of a variety of buyouts.

Today, Vought generates roughly $1.9 billion in revenues and has a wide product line, which includes fuselages, wings, empennages (tail assemblies) and helicopter cabins. Roughly 80% of its revenues come from sole-source, long-term contracts. And as for the mix, about $947 million in revenues derives from commercial customers, $664 million from the military and $267 million from business jets.

But Vought has not been without its problems. In 2009, the company was proving unable to meet Boeing's (BA) requirements on a contract to supply parts of the new 787 Dreamliner. To deal with the issues, Boeing actually purchased the Vought plant making the parts for $580 million and $422 million in forgiven advance payments.

Despite this, Vought still has extensive customer contracts with Boeing, as well as major agreements with Airbus, Gulfstream and Sikorsky.

A High-Flying Deal

Based on its latest quarterly report, Triumph was already showing lots of traction. Revenues were up 10% to $313.5 million and cash flow more than doubled to $53.2 million, showing the payoff of the cost-cutting efforts.

But the deal for Vought will turbocharge things even more. The transaction is expected to add $1 in earnings per share, not including synergies or potential cost savings. Triumph's CEO Richard Ill thinks there could be $8 million to $10 million in synergies over the next 18 months. In other words, the ultimate benefits of the deal could be even larger.

Regardless, Triumph will have more scale, with $3.1 billion in revenues and EBITDA of $466 million, leaving it well-positioned for the upturn in the aviation market.

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