$11.75 billion is the agreed price for GE Aerospace's (GE) acquisition of Consolidated Precision Products, announced September 8. The deal structures as $7 billion in cash and roughly $4.75 billion in new debt. The math reconciles. GE shares edged higher on the disclosure, though the stock remains down about 12% from its August high.
CPP is Cleveland-based and has supplied GE for 15 years, running more than 20 global facilities that produce complex structural castings and airfoils for jet engines. Its position in the engine supply chain makes it a critical bottleneck for output. Component shortages at CPP have slowed GE engine deliveries and aftermarket servicing, dragging on a high-margin revenue stream. Bringing the supplier in-house converts that vendor dependency into captive production across a globally distributed facility footprint.
Funding and forward case
| Item | Amount |
|---|---|
| Total consideration | $11.75 billion |
| Cash | $7.00 billion |
| New debt (remainder) | ~$4.75 billion |
Management projects the transaction to be accretive to adjusted earnings per share and free cash flow in the first full year of consolidated operations. GE plans to apply FLIGHT DECK, its lean operational framework, to CPP's facilities, with expected expansion in production capacity and structural cost reduction over time. Both are forward projections per management.
The 80,000-engine base and its aftermarket run-rate
GE holds a nearly 80,000-engine installed base worldwide. That scale anchors a high-margin aftermarket servicing business that generates substantial free cash flow. Persistent component shortages have been compressing that aftermarket run-rate. Securing CPP's casting and airfoil output removes the bottleneck where it most directly limits servicing throughput.
In the most recently reported quarter, GE posted 24% year-over-year revenue growth and 22% year-over-year earnings per share growth. Analyst consensus rates GE a "Strong Buy," with a mean price target of roughly $397. Options contracts expiring mid-December reflect near 12% upside to about $376, based on the upper price on those contracts.