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Veritas is front runner to buy Cobham Advanced Electronic Solutions’ space unit as it nears sale, sources say

Veritas Capital is the front runner to acquire Advent International-backed Cobham Advanced Electronic Solutions' space business after final bids were recently collected, said two sources familiar with the matter. 

This news service reported in mid-September that Advent International was collecting final bids in the sale of Cobham Advanced Electronic Solutions' (CAES) space business. Veritas Capital, AMETEK [NYSE:AME] and BAE Systems [LON:BA] were among the bidders circling the business, as reported.

The two sources said the business could fetch a multiple of around 13x to 15x EBITDA. CAES' space unit generates EBITDA of around USD 130m, as reported. Its sale is being run by Goldman Sachs’ and Lazard’s US-based teams, this news service reported in June.

The sale of CAES’ space unit is part of Advent International-backed owner Cobham Limited’s larger ambitions to sell the entire division, as reported. The remaining parts of CAES are expected to come to market in a separate auction when the space unit is sold, it was further reported. EBITDA for the whole of CAES is around USD 225m to USD 235m, as reported.

Advent has made several moves over the years to restructure Cobham’s portfolio, most recently selling Cobham Microwave to Fonds de Consolidation et Developpement des Entreprises in March and launching a sale of Cobham Aviation Services in Australia in February, according to media reports, and selling Cobham Mission Systems to Eaton [NYSE:ETN] in 2021.

Advent acquired Cobham in 2020 in a USD 5bn deal. Under its ownership, Cobham has signed several high-profile contracts, including a USD 500m supplier deal between its CAES unit and Raytheon Technologies.  

Cobham won the UK government's approval for its GBP 2.57bn takeover of UK-based Ultra Electronics in July.

Advent, Cobham and Goldman Sachs declined to comment. Veritas Capital and Lazard did not return requests for comment.