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PwC: Aerospace, Defense Sector Recorded $5.9B in Q3 2018 M&A Deal Value

A new PwC report says the total value of mergers and acquisitions in the global aerospace and defense industry was $5.9B in the third quarter of 2018, down 49 percent from the same period last year.

PwC said the number of M&A deals in the A&D sector plummeted 18 percent to 89 transactions in Q3 2018 and the average deal size was $197.1M, which reflects a 41 percent drop from the prior year’s third quarter.

The announcement of Boeing (NYSE: BA) and Embraer in July to form a commercial aviation-focused joint venture in which the Chicago-based defense contractor will own 80 percent of the business accounted for approximately 67 percent of the total deal value, making it the largest transaction in Q3 2018.

Bob Long, U.S. aerospace and defense deals leader at PwC, said rising government spending, competition and emerging technologies as well as macro trends are expected to boost M&A activity for the rest of the year and 2019.

Those emerging technologies include cloud, cybersecurity and command, control, communications, computer, intelligence, surveillance and reconnaissance, according to the report.

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