The aerospace and defense industry is a major driver of technological innovation and economic growth globally. As such, investment banks play a crucial role in advising and financing companies in this strategic sector. The top investment banks in aerospace and defense stand out for their deep industry expertise, strong client relationships, and ability to execute complex, high-value transactions.
In recent years, M&A activity in the aerospace and defense sector has been robust, with megadeals like the Raytheon-United Technologies merger and acquisitions by the likes of Boeing, Airbus, Lockheed Martin and Northrop Grumman. Aerospace and defense investment banks have been at the forefront, providing financial advice, securing financing, and managing stakeholder communications for these landmark deals.
Looking ahead, investment in aerospace and defense is projected to grow steadily, driven by geopolitical tensions, technological advances, and fleet renewal among airlines and militaries globally. The leading aerospace and defense investment banks are well-positioned to capitalize on these industry trends and changing client needs.
JP Morgan dominates aerospace and defense investment banking
JP Morgan is widely regarded as the top investment bank in aerospace and defense globally. The firm has advised on over $500 billion in announced aerospace and defense M&A transactions over the past decade.
JP Morgan’s aerospace and defense franchise benefits from the bank’s strong corporate client relationships, industry expertise, and global distribution platform. The firm has advised many of the largest strategic deals in the sector, including the Raytheon-United Technologies merger of equals.
Beyond M&A, JP Morgan excels at helping aerospace and defense clients raise capital through equity, debt and convertible issuances. The firm also provides risk management, treasury services and strategic advice to companies across the aerospace and defense supply chain.
Boeing and Airbus’s go-to bankers
As the two dominant players in commercial aerospace, Boeing and Airbus lean heavily on investment banks for capital markets and M&A support.
Boeing works closely with JP Morgan and Citi on aircraft financing, bond issuances, interest rate hedging, share buybacks and other strategic initiatives. Recently, Boeing tapped JP Morgan as joint bookrunner on a $25 billion bond sale, one of the largest US investment grade corporate bond offerings on record.
For Airbus, Goldman Sachs and BNP Paribas are among the leading investment banking partners. In 2019, Goldman Sachs served as joint global coordinator and bookrunner when Airbus SE listed its Airbus Canada Limited Partnership subsidiary on the Toronto Stock Exchange.
Given Boeing and Airbus’s financing needs and appetite for acquisitions, these relationships with key investment banks are essential.
Defense giants partner with top-tier advisers
The largest aerospace and defense companies maintain close ties with elite investment banks for M&A and financing mandates.
Lockheed Martin has an extensive history with Goldman Sachs, including working together on Lockheed’s acquisition of Sikorsky Aircraft from United Technologies. Goldman also acted as dealer manager for Lockheed’s $4 billion accelerated share repurchase program.
Meanwhile, Credit Suisse has been a longstanding advisor to General Dynamics, providing M&A advice, acquisition financing and other services. Most recently, Credit Suisse helped arrange committed financing for General Dynamics’ pending acquisition of CSRA Inc.
Northrop Grumman, Raytheon Technologies and other defense titans similarly turn to top-tier investment banks like Morgan Stanley and Barclays for strategic counsel and access to capital.
Boutiques provide deep sector expertise
While bulge bracket banks dominate deal volume, specialized investment banks also play an important role in aerospace and defense banking.
Boutique firms like Jefferies, Evercore and Lazard boast significant aerospace and defense expertise and relationships. In 2015, Evercore advised United Technologies on the $9 billion sale of Sikorsky to Lockheed Martin. And Lazard recently advised Woodward Inc. on its $6.4 billion merger with Hexcel Corp.
Although they lack the balance sheet strength of large banks, boutiques thrive by providing informed, conflict-free advice grounded in deep sector knowledge. They remain go-to advisers for many mid-sized aerospace and defense companies.
From titans like Boeing and Lockheed Martin to emerging players across the supply chain, aerospace and defense companies rely on skilled investment banks for advice and access to capital. As the industry evolves and consolidates, the role of top-tier financial advisers will only increase. Aerospace and defense banking leaders like JP Morgan, Goldman Sachs and boutiques firms like Lazard and Evercore are best positioned to support clients through this dynamic period.