A Tale of Two Aerospace Mergers

Over the past few years, we’ve helped two of our aerospace distribution clients go through successful acquisitions and mergers. Proponent is an aerospace value-added distributor that has historically focused on the commercial sector. AllClear is an aerospace distributor and service provider for the military and defense sector.

Proponent was formed in 2017, after the acquisition of Avio-Diepen by our longtime client Kapco Global. AllClear was launched in 2020, after the acquisition of Kellstrom Defense by Aero Precision.

In helping both companies go through their M&A events and creating the branding, messaging and marketing around those events, we were in a unique position to compare and contrast the key ways in which they were similar and unique.

 

What Was the Same

Two Companies, Both Alike in Size

In both cases, the two companies coming together were of similar size. They also operated in similar parts of the market, frequently competing for and even sharing customers and partners. If you were a customer of Kapco, you very likely knew about Avio-Diepen, and if you were a customer of Aero Precision, you very likely knew about Kellstrom.

In strategizing with company executives around both events, we came to the same conclusion. While these were technically acquisitions, it was in everyone’s best interest to treat them more like mergers. Both events had the goal of retaining the best of both merging companies while realizing the benefits of an expanded market presence, efficiencies, and opportunities for further market penetration.

With those goals in mind, subsuming one company into the other wasn’t the right strategy. Merging the companies into a new entity, on equal footing, was.

From a branding standpoint, that meant instead of simply updating an existing brand, we were creating a new name, brand, and identity for both companies, post-merger.

Key Takeaway: Every M&A has unique branding needs. Think about how you want to present the combined companies to your customers and employees, and develop your post-merger branding from that perspective.

 

A Familiar, Brand-New Brand

With the goal of presenting a new merged company established, we moved on to defining what that brand would be.

In the case of Kapco and Avio-Diepen, our research and branding strategy focused on defining the core, shared essence of both companies. As value-added distributors, both companies worked on behalf of their customers to secure critical parts and supplies that kept customers’ aircraft dependably flying day-in and day-out around the globe. They operate as an essential resource, and a true partner for those customers.

That’s how we came to the name Proponent. It means, literally, an “advocate, champion or supporter.” It wasn’t just a brand. It was a one-word mission statement.

For Aero Precision and Kellstrom, the goal was similar, but the context was a bit different. Both companies had a core brand promise of safety and the support of allied militaries around the globe. Both companies employed a high percentage of veterans, men, and women who had firsthand experience with the platforms they supported, and the sacrifice of military service.

That’s how we came to AllClear. It’s a phrase that military pilots hear every day, and symbolizes the combined company’s promise of support and safety.

Key Takeaway: Your brand should reflect your values and the value you provide to your customers.

 

What Was Different

Counter Cultures

Aero Precision and Kellstrom had, even before their merger, similar cultures. Both companies were headquartered in California, served similar parts of the market and customers, and attended many of the same trade shows and industry events.

While there were certainly differences when the companies came together, we agreed that a significant, dedicated internal-branding campaign wasn’t a top priority.

Avio-Diepen and Kapco faced a much wider cultural gap. While the companies served much of the same market and customers, they had significant internal cultural differences. Most of these centered around geography and regional business culture, with Kapco headquartered in Southern California and Avio-Diepen in the Netherlands.

With such a significant culture gap in place, we agreed with Proponent’s executive team that internal branding needed to be a priority. We created a year-long internal campaign that incorporated interactive learning modules, videos, discussions, presentations, and more.

At the end of the year, Proponent was able to clearly demonstrate a more unified culture that supported the growth and expansion of the combined company.

Key Takeaway: Significant internal branding projects may not be necessary for every M&A event, but when they’re done right, they can be a critical tool in helping to unify unique company cultures.

Different Agency Relationships

Finally, there was a significant difference in our agency’s relationship with each company.

We have over a decade of history working with Proponent / Kapco Global. We’d helped them through several acquisitions, and they knew about the other M&A events we’d helped other clients through.

On the other hand, we’d never worked with Aero Precision or Kellstrom Defense before they hired us for their M&A branding project. They came to us based on our experience in aerospace and with M&A events. Aero Precision acquired Kellstrom in February, we were hired in the spring, and we launched the new brand mid-summer.

Our long experience with Proponent gave us valuable insight into their business, market, and customers. On the other hand, we were able to bring a fresh perspective to Aero Precision and Kellstrom, and quickly get up to speed (and provide some insight to the company’s executive team) through a series of interviews and an in-depth research process.

Key Takeaway: It’s important to choose a partner with experience in M&A events, whether that’s someone you’ve worked with for a long time, or a new relationship.

Navigating Your M&A Event

We’ve helped our clients navigate more than 20 M&A events in the last decade. If your company is planning for or going through a M&A event soon, we’d be happy to help you make it a success. Just let us know.