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General Dynamics to Acquire Jet Aviation for $2.25 Billion

Written by thomas · Filed Under Aeronautics News 

August 20, 2008

thomas

Transaction will create a large, worldwide business-jet support network and
expand General Dynamics’ Aerospace operations into global flight-support
services; current Jet Aviation management to remain in place.

FALLS CHURCH, Va., Aug. 19 /PRNewswire-FirstCall/ — General Dynamics
(NYSE: GD) and Dreamliner Lux S.a.r.l., a company controlled by the Permira
Funds, have entered into a definitive agreement for General Dynamics to
acquire Zurich, Switzerland-based Jet Aviation for CHF 2.45 billion
(approximately $2.25 billion) in cash.

The proposed acquisition, which has been approved by the boards of
directors of both companies, would be immediately accretive to General
Dynamics’ earnings. The transaction is subject to normal regulatory
approvals, and is expected to close by the end of 2008.

Jet Aviation, with its worldwide headquarters in Zurich, was founded in
Switzerland in 1967 and is one of the world’s leading business-aviation
services companies. Close to 5,600 employees cater to clients’ needs from
25 airport facilities throughout Europe, the Middle East, Asia and North
and South America. Services provided include maintenance, repair and
overhaul; completions and refurbishments; engineering; fixed base
operations (FBO); along with aircraft management, flight support and global
executive-jet charter services; aircraft sales and acquisitions and
personnel services. In the past three years, under the control of the
Permira Funds, Jet Aviation has developed from a family owned business to a
global leader in business aviation services.

Following completion of the acquisition, Jet Aviation will continue
serving the entire aircraft manufacturing community and its global client
base as a new business unit within the General Dynamics Aerospace group
operating under the Jet Aviation and Midcoast Aviation brands.

“We are delighted to be acquiring Jet Aviation and partnering with the
current management team to continue its success. Under the Permira Funds’
ownership, Jet Aviation has become a global market leader in
business-aviation services; as a unit of General Dynamics, Jet Aviation
will support one of our core growth areas,” said Nicholas D. Chabraja,
General Dynamics chairman and chief executive officer.

“The Permira Funds backed a period of significant capital investment in
this business that drove rapid organic growth, and Jet Aviation
strengthened its franchise globally through a successful acquisition
strategy. As a result, the company is well-positioned to capture further
growth opportunities in the business aviation market. Through General
Dynamics’ acquisition of this strong and rapidly growing organization, we
will expand our participation in the business-aviation industry well beyond
that of our current operations,” Chabraja said.

Jet Aviation and its principal subsidiary companies, Midcoast Aviation,
St. Louis, Mo., and Savannah Air Center, Savannah, Ga., operate in nine
U.S. locations, including Bedford/Boston, Mass.; Chicago, Ill., Dallas and
San Antonio, Texas; Lambert, Mo.; Palm Beach, Fla.; and Teterboro, N.J. The
company also operates international facilities in Basel, Geneva and Zurich,
Switzerland; Beijing and Hong Kong, China; Cologne, Dusseldorf, Hannover
and Kassel, Germany; Dubai, UAE; Jeddah, Saudi Arabia; Kuala Lumpur,
Malaysia; London Biggin Hill, U.K.; Moscow Vnukovo, Russia; Riyadh, Saudi
Arabia; and Singapore. More information about the company is available
online at http://www.jetaviation.com.

The General Dynamics Aerospace group designs, develops, manufacturers
and services a comprehensive offering of advanced business-jet aircraft,
and has a strong reputation for superior aircraft design, safety, quality
and reliability; technologically advanced onboard systems; and
award-winning product support.

General Dynamics’ senior management will discuss this transaction and
answer questions from investors and financial analysts at 8:30 a.m. on
Tuesday, August 19, at the Four Seasons Hotel, 57 East 57th Street, New
York. Investment community representatives are invited to participate in
person or by phone, and the conference will be webcast through a link at
the General Dynamics website, http://www.generaldynamics.com.

General Dynamics, headquartered in Falls Church, Va., employs
approximately 84,600 people worldwide and anticipates 2008 revenues of
approximately $29.5 billion. The company is a market leader in business
aviation; land and expeditionary combat systems, armaments and munitions;
shipbuilding and marine systems; and information systems and technologies.

Certain statements made in this press release, including any statements
as to future results of operations and financial projections, may
constitute “forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995, as amended. Forward-looking
statements are based on management’s expectations, estimates, projections
and assumptions. These statements are not guarantees of future performance
and involve certain risks and uncertainties, which are difficult to
predict. Therefore, actual future results and trends may differ materially
from what is forecast in forward-looking statements due to a variety of
factors. Additional information regarding these factors is contained in the
company’s filings with the Securities and Exchange Commission, including,
without limitation, its Annual Report on Form 10-K and its Quarterly
Reports on Form 10-Q.

All forward-looking statements speak only as of the date they were
made. The company does not undertake any obligation to update or publicly
release any revisions to any forward-looking statements to reflect events,
circumstances or changes in expectations after the date of this press
release.

SOURCE General Dynamics

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