VSE Corporation Acquires HAECO Special Services

ALEXANDRIA, Va.--(BUSINESS WIRE)-- VSE Corporation (NASDAQ: VSEC), a leading provider of aftermarket distribution and maintenance, repair and overhaul (MRO) services for land, sea and air transportation assets for government and commercial markets, today announced that it has acquired HAECO Special Services, LLC (“HSS”) from HAECO Airframe Services, LLC, a division of HAECO Americas (“HAECO”), in an all cash transaction.

HSS is a leading provider of fully integrated MRO support solutions for military and government aircraft. HSS offers scheduled depot maintenance, contract field deployment and unscheduled drop-in maintenance for a U.S. Department of Defense contract specifically for the sustainment of the U.S. Air Force (“USAF”) KC-10 fleet. The experienced workforce of HSS includes nearly 280 employees operating from two hangar locations in Greensboro, North Carolina.

Transaction Rationale

  • Expands VSE Federal & Defense MRO capabilities. HSS expands VSE’s aircraft MRO capabilities and provides VSE with access to new facilities, certifications and technical expertise required to provide end-to-end support for government aircraft fleet throughout their useful lives. HSS has averaged 30 aircraft introductions and 400,000 man-hours of aircraft maintenance per year since 2015. These capabilities expand VSE’s existing USAF programs Contract Field Teams programs.
  • Strong backlog and contract visibility. HSS’ long-standing relationship with the USAF, including support of the products, has resulted in consistent cash flows from operations with minimal capital expenditure requirements. As a subcontractor under the current KC-10 contract, HSS’ calendar-driven maintenance provides contracted revenue visibility into 2025.
  • New contract opportunities. VSE views additional opportunities to further diversify HSS’ contract mix beyond the KC-10 contract, including both subcontractor and prime roles on aircraft sustainment and modification programs.
  • Financially accretive transaction. This transaction is immediately accretive to VSE’s Federal & Defense Segment. HSS’s value-added service offerings support the higher margin, technical services strategic focus for the segment.

Management Commentary

“We are excited to welcome the outstanding HAECO Special Services team to VSE,” stated John Cuomo, President and CEO of VSE Corporation. “This transaction further expands our value-added suite of MRO solutions available to military customers, while positioning us to capitalize on higher-margin technical service opportunities. HSS’ operating income and cash flow profile, strong backlog and contract diversification efforts are highly complementary to our Federal & Defense Services business and strategy, positioning us to further support military and government customers with on-demand MRO support for aging, mission-critical assets.”


Jones Day served as legal counsel to VSE Corporation. Covington served as legal counsel to HAECO. Jefferies LLC served as financial advisor to HAECO.


VSE is a leading provider of aftermarket distribution and repair services for land, sea and air transportation assets for government and commercial markets. Core services include maintenance, repair and overhaul (MRO) services, parts distribution, supply chain management and logistics, engineering support, and consulting and training services for global commercial, federal, military and defense customers. VSE also provides information technology and energy consulting services. www.vsecorp.com


A wholly owned subsidiary of the HAECO Group, HAECO Americas (formerly TIMCO Aviation Services) supports global aircraft operators and owners with comprehensive aircraft care services including base maintenance from two multi-hangar locations and engine MRO support in the U.S. The company’s HAECO Cabin Solutions division provides interiors design, engineering, certification, and cabin reconfiguration services, as well as manufactured products including passenger seating, structures, galleys, and lavatories. www.haeco.aero


This document contains certain forward-looking statements. These forward-looking statements, which are included in accordance with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, may involve known and unknown risks, uncertainties and other factors that may cause VSE’s actual results and performance in future periods to be materially different from any future results or performance suggested by the forward-looking statements in this document. Although we believe the expectations reflected in such forward-looking statements are based upon reasonable assumptions, we can give no assurance that actual results will not differ materially from these expectations. “Forward-looking” statements, as such term is defined by the Securities Exchange Commission (the “SEC”) in its rules, regulations and releases, represent our expectations or beliefs, including, but not limited to, statements concerning the expected benefits of the acquisition, management's plans, projections and objectives for future operations, scale and performance, integration plans and expected synergies therefrom, and anticipated future financial and operating performance results. Without limiting the generality of the foregoing, words such as “may,” “will,” “expect,” “believe,” “anticipate,” “intend,” “forecast,” “seek,” “plan,” “predict,” “project,” “could,” “estimate,” “might,” “continue,” “seeking” or the negative or other variations thereof or comparable terminology are intended to identify forward-looking statements. These statements, by their nature, involve substantial risks and uncertainties, certain of which are beyond our control, and actual results may differ materially depending on a variety of important factors, including, but not limited to, our failure to realize the benefits expected from the acquisition; failure to promptly and effectively integrate the acquisition; the effect of the acquisition on our ability to retain customers and maintain relationships with suppliers, on operating results and on the business generally; the uncertainty surrounding the ongoing COVID-19 outbreak and the other factors identified in our reports filed or expected to be filed with the SEC including our Annual Report on Form 10-K for the year ended December 31, 2020. All forward-looking statements made herein are qualified by these cautionary statements and risk factors and there can be no assurance that the actual results, events or developments referenced herein will occur or be realized. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's analysis only as of the date hereof. We undertake no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results.


Noel Ryan
(720) 778-2415

Source: VSE Corporation