Precision Aerospace & Defense Group (PAD) M&A Announcement summary

Deal rationale and strategic fit

• The merger creates a Nasdaq-listed, vertically integrated solutions provider in aerospace, defense, and space, leveraging sector tailwinds, blue-chip customer relationships, and a robust backlog.

• The combined entity aims to address gaps in timely, high-volume delivery for defense and space customers, positioning as a tier one and two supplier.

• Strategic fit is enhanced by a history of accretive acquisitions, minimal overlap, and a pipeline targeting specialized capabilities for sustainable, repeatable growth.

• PAD's multi-division platform delivers mission-critical products and services, supporting military, commercial aviation, and space infrastructure.

Financial terms and conditions

• Transaction values the company at up to $320 million implied enterprise value, assuming a $10.00 per share price and pending acquisitions.

• Acquisitions are made at 5–7x EBITDA multiples, using a mix of cash and stock to incentivize management teams.

• 2025 organic projections: $70M+ revenue, $14.4M EBITDA; 2026 organic: $85M revenue, $16.2M EBITDA.

• 2026 pro forma (with acquisitions): $129M revenue, $25M+ EBITDA.

• FACT's trust account holds approximately $175 million in gross proceeds, subject to redemptions; PAD shareholders expected to own about 59% post-merger.

Synergies and expected cost savings

• Incoming capital will support balance sheet optimization, planned acquisitions, and future growth initiatives.

• Acquired companies are profitable standalone, requiring no restructuring or right-sizing.

• 30% available plant capacity allows for growth without additional CapEx.

• Cross-selling and integration of specialized capabilities are expected to drive further value.