When it came time to sell a Miramar-based aircraft repair and services company, executives at 1st Choice Aerospace Inc. turned to Gunster.
The law firm represented 1st Choice in its sale to VSE Aviation Inc., an Alexandria, Virginia-based engine service and supply company, for $112 million plus a potential $40 million earn-out based on its financial performance over the next two years.
The South Florida company had “significant growth over the last two years and decided maybe this was a good time to exit and partner with a company that would help them continue to grow the business,” said Michael Mitrione, one of the Gunster attorneys who represented 1st Choice.
Gunster shareholders Mitrione, Joseph Chase, Tom Hickey and Daniel Glassman, all based in West Palm Beach, as well as shareholder Gustav Schmidt in Fort Lauderdale closed the deal Jan. 10. Associates John Joseph Ogilby in Miami as well as Christopher Seifter and Stacie Townsend in West Palm Beach also worked on the transaction.
“VSE has some operations that create some good synergies with what 1st Choice is doing. That’s part of why they were willing to pay a good purchase price for 1st Choice,” Chase said.
The company specializes in pneumatics, crew seats and fuel, cargo and waste systems for commercial, cargo and military aircraft, according to its website. It’s a minority-owned small business with another office in Hebron, Kentucky.
Aside from maintenance and repair, VSE Aviation, a subsidiary of publicly traded VSE Corp., also provides supply chain and logistics services as well as material support for aircraft engines, according to its website.
Arent Fox counsel Carter Strong in Washington represented VSE on the acquisition.
The plan, at least for the short term, is for the status quo at 1st Choice, Chase said.
It will keep its 176 employees, and the management team of president Jose Sardinas, vice president Mario Catalano, partner Octavio Silva, executive vice president Chris Yeazel and chief operating officer Mike Barcey stays in place.
“Based on the employment packages the clients got going forward, the intention is, at least for the time being, for the company to stay in Miramar or at least in South Florida,” Chase said. Eventually, the “buyer will do what it will do. We just don’t know.”
The earn-out provision, which is common in mergers and acquisitions, is an incentive to push 1st Choice to boost performance, which in turn would benefit VSE.
This isn’t the first time three of 1st Choice’s executives — Sardinas, Catalano and Silva — have created a company in the aviation industry and then sold it. It’s the third time, with Gunster involved in all of the transactions.
In 2006, Mitrione and others from the West Palm Beach office represented Kellstrom Aerospace LLC in its acquisition of Catalano, Sardinas and Silva’s High Tech Avionics & Accessories Inc.
In 2014, Mitrione and other Gunster attorneys in West Palm Beach and Fort Lauderdale represented Catalano, Sardinas and Silva in the sale of another company to Wencor Group, a Georgia-based aerospace company.
In Florida, the aviation and aerospace industries are big employers and economic drivers with the space program, aviation training facilities, parts production, repair businesses, 130 public-use airports and 20 commercial airports, according to Enterprise Florida.