Eaton to buy Cobham Mission Systems in $2.83 billion deal

(Reuters) - Hydraulics maker Eaton Corp said on Monday it had agreed to buy air-to-air refueling equipment maker Cobham Mission Systems in a $2.83 billion deal to strengthen its aerospace business.

U.S.-based Cobham mainly serves the defense sector, Eaton said.

Excluding $130 million in tax benefits, Cobham’s purchase price is about 14 times its 2020 earnings before interest, taxes, depreciation, and amortization (EBITDA) and 13 times its estimated 2021 EBITDA, Eaton said.

Ireland-based Eaton makes products including explosion-proof instrumentation, pumps, motors and hydraulic power units.

The deal is expected to close in the second half of 2021.

Reporting by Ankit Ajmera in Bengaluru; Editing by Vinay Dwivedi