Hexcel’s $160 Million Acquisition of ARC Technologies


Paul, Weiss is representing Hexcel Corporation in its acquisition of ARC Technologies, Inc.

Hexcel Corporation (NYSE:HXL) has entered into a definitive agreement to acquire ARC Technologies, Inc., a leading supplier of custom RF / EMI and microwave absorbing composite materials for military, aerospace and industrial applications. The acquisition strengthens Hexcel’s existing advanced materials portfolio in structural composites and thermoplastics and provides new opportunities for growth and market penetration.

ARC Technologies, founded in 1988, is a privately-owned manufacturer with about 170 employees working at two locations in Amesbury, Massachusetts. The company has a wide range of capabilities for producing RF / EMI and microwave absorbing materials and specializes in combining absorptive metallic filler compounds – including carbon, iron and nickel-coated graphite – with a proprietary blend of polymer resins to generate various matrix materials including structural composites and thermoplastics.

ARC Technologies is expected to generate about $50 million in revenue in 2018. The agreed-upon purchase price is $160 million, which represents a multiple of 11.9 times 2018 expected adjusted EBITDA. The transaction is expected to be accretive to Hexcel’s earnings in 2019 and is subject to customary commercial and regulatory conditions and approvals. It is expected to close early in 2019.

The Paul, Weiss team includes corporate partner Steven Williams (Picture), John Kennedy and Catherine Goodall and counsel Nathan Sawyer; tax partner David Mayo; intellectual property partner Chuck Googe; real estate partner Peter Fisch and counsel Barry Langman; employee benefits partner Robert Fleder; international trade counsel Richard Elliott; environmental counsel William O’Brien; antitrust counsel Marta Kelly; and litigation counsel Peter Jaffe.

Involved fees earner: Steven Williams – Paul Weiss Rifkind Wharton & Garrison; John Kennedy – Paul Weiss Rifkind Wharton & Garrison; Nathan Sawyer – Paul Weiss Rifkind Wharton & Garrison; Catherine Goodall – Paul Weiss Rifkind Wharton & Garrison; David Mayo – Paul Weiss Rifkind Wharton & Garrison; Charles Googe – Paul Weiss Rifkind Wharton & Garrison; Peter Fisch – Paul Weiss Rifkind Wharton & Garrison; Barry Langman – Paul Weiss Rifkind Wharton & Garrison; Robert Fleder – Paul Weiss Rifkind Wharton & Garrison; Richard Elliott – Paul Weiss Rifkind Wharton & Garrison; Peter Jaffe – Paul Weiss Rifkind Wharton & Garrison; William O’Brien – Paul Weiss Rifkind Wharton & Garrison; Marta Kelly – Paul Weiss Rifkind Wharton & Garrison;

Law Firms: Paul Weiss Rifkind Wharton & Garrison;

Clients: Hexcel Corporation;