Hexcel Corporation (HXL) and Woodward, Inc. (WWD) announced that the companies have mutually agreed to terminate their previously announced $6.4-billion merger deal.
The decision has been duly approved by the boards of both companies.
The companies decided to call off the mega-merger deal in response to the increasing impact of the coronavirus (COVID-19) pandemic on the aerospace sector and global markets.
The virus outbreak gradually forced airline companies worldwide to halt operations. This, in turn, has negatively impacted aircraft manufacturers along with parts suppliers like Hexcel and Woodward. So synergies from the combination of the two companies might have not brought out the desired outcome amid the pandemic.
In a joint statement, Tom Gendron, Chairman, CEO and President of Woodward, and Nick Stanage, Chairman, CEO and President of Hexcel, said, “While we both believed from the outset, and continue to believe, in the benefits of a combined Woodward and Hexcel, we mutually concluded after careful consideration that given the significant uncertainty in the market, it would not be prudent to continue to pursue the combination and integration of our companies in a merger of equals.
Although we are disappointed with this outcome, we are confident this is the right decision for our customers, our shareholders, and our employees as it allows each of us to dedicate our focus and resources toward ensuring Woodward and Hexcel each remain strong and closely connected with our customers and supply chains during these unparalleled times. We continue to be hopeful that our two companies will find opportunities to collaborate on next-generation platforms in the future for the benefit of our customers.”
Hexcel Corporation is an advanced composites technology company, based in Stamford, Connecticut. The company develops and manufactures structural materials including carbon fiber, specialty reinforcements, resins, honeycomb, adhesives, engineered honeycomb composite structures, and prepregs.