Bidding War for Jeppesen Signals Shift in M&A Strategy

Shayan Parikh
May 15, 2025
4 min read

As 2025 progresses, expect increased high-value carve-outs with renewed private equity aggression and more strategic exits in the industry. Boeing's potential sale of its Jeppeson navigation unit encapsulates these various trends. Jeppesen, valued at roughly $8 to $9 billion, is a global leader in flight navigation charts and software as well as digital aviation solutions. It has been a significant part of Boeing's business since its acquisition in 2000 due to its advanced navigation charts, which help with flight safety, air travel efficiency, and aviation communication. However, with Boeing looking to divest the unit in order to streamline operations and reduce debt load, Jeppesen will likely be sold soon, as indicated by Boeing's openness to bids.

Boeing has recently sold other assets, such as its maintenance facility at London's Gatwick airport, and the company is reportedly shopping its drone division, Insitu. The sale of assets are likely aimed at refocusing Boeing's essential manufacturing and defense operations while simultaneously addressing financial pressures that have been building over the past couple of years. Boeing seeks to increase liquidity and streamline to be more agile in the aerospace market. Jeppesen seems specifically appealing to buyers due to its recurring revenue model, industry relations, and importance in aviation logistics. Thus, Jeppeson may be an ideal acquisition for private equity firms seeking reliable cash flows.

Private Equity Interest

Reports indicate that various private equity firms, including Vista Equity, Warburg Pincus, Advent International, and TPG, have joined together to pursue the acquisition. The other parties bidding for Jeppesen include aerospace parts maker TransDigm and firms such as Thoma Bravo and Silver Lake. After slowing down in 2023 due to high interest rates and market volatility, private equity firms are re-entering the market with renewed ambition, deploying record levels of dry

powder. This Jeppesen deal symbolizes a shift in private equity strategy, which increased its focus on corporate carve-outs. According to FIT Consulting, in the first quarter of 2024, carve-outs and divestitures accounted for 12.6% of all PE buyouts, a notable increase from 5.7% in the fourth quarter of 2021. This statistic

illustrates the increasing involvement of carve-outs in private equity deals. Furthermore, a survey by AURELIUS indicates that over 80% of respondents anticipate a rise in corporate carve-out activities in 2025, up from 66% the previous year.

Private equity firms expect transactions to be more worthwhile, as Jeppesen has showcased, due to the Federal Reserve's expected reduced rates, eased borrowing costs, and improved capital market sentiment. These firms are no longer acting cautiously. Boeing's openness to selling to private equity firms reinforces the idea that private equity firms are becoming more strategic, with many focusing more on technology and infrastructure, not just for profit but to form a diversified portfolio of holdings. If the private equity firms win the bid, expect more collaborative bids and aggression in financing.

How a Leveraged Buyout Would Play Out

If a private equity consortium succeeds, it will likely structure the deal as a leveraged buyout, using debt to finance most of the purchase. The private equity consortium would likely contribute 30-40% of the cost (approximately $3 billion) in equity and borrow the other 60-70% (approximately $6 billion) from banks or other institutions. Over the next few years, as Jeppesen increases its profitability, Jeppesen's recurring revenue model will generate cash flow that will allow the company to pay down the debt. Then, after a few years, the private equity firms could sell Jeppesen to pay off any remaining debt, and the equity investors would then share in the profit.

The Trend of Strategic Exits in the Market

The Jeppesen transaction also showcases how strategic exits have become a prominent trend in 2025. According to PwC and Bain & Company, corporations across various industries are increasingly removing non-core assets to reallocate capital towards their most core forefront objectives. Jeppesen, while still very profitable, takes away concentration from Boeing's streamlined vision centering aerospace manufacturing and defense. This transaction not only reinforces Boeing's discipline with their capital but sets a precedent for how legacy firms may reshape their portfolios in order to get more in touch with their roots. In our post-COVID world, we are witnessing an emerging trend of companies selling to grow and divesting non-core assets to focus on other strategic priorities.

Main Takeaway

In summary, Boeing's sale of Jeppesen represents newfound aggression coming from private equity firms looking to expand their versatility with carve-outs as well as an increase in strategic exits in the industry so companies can put more funds into their core assets.

References:

Bain & Company. (2025, January 23). M&A market poised for a comeback in 2025 as headwinds ease, finds Bain & Company. https://www.bain.com/about/media-center/press-releases/20252/ma-market-poised-for-a-comeback-in-2025-as-headwinds-ease-finds-bain--company/

Ryan & Wetmore. (2025). 2025 private equity forecast: Trends and strategies. https://www.ryanandwetmore.com/insights/2025-private-equity-forecast-trends-and-strategies

AURELIUS Group. (2025). Carve-out activity set to increase in 2025. https://www.aurelius-group.com/carve-out-activity-set-to-increase-in-2025

Reuters. (2025, March 28). Buyout, aerospace firms close in on $8 billion-plus

Boeing navigation unit – sources. https://www.reuters.com/business/aerospace-defense/buyout-aerospace-firms-close-8-billion-plus-boeing-navigation-unit-sources-say-2025-03-28/

Private Equity Wire. (2025). Boeing's Jeppesen nav unit war heats up. https://www.privateequitywire.co.uk/boeings-jeppesen-nav-unit-war-heats-up/

McKinsey & Company. (2025). Global private markets review 2025. https://www.mckinsey.com/industries/private-capital/our-insights/global-private-markets-report

Flight Insight. (2025). Jeppesen: The quiet powerhouse in digital aviation. https://www.flight-insight.com/post/jeppesen

FTI Consulting. (2025). High stakes, higher returns: Carve-outs & private equity. https://www.fticonsulting.com/insights/articles/high-stakes-higher-returns-carve-outs-private-equity