AAR will acquire the majority stake of aircraft maintenance firm MRO Holdings for $1.8 billions.

Reuters, September 28 - Aircraft aftermarket services provider AAR (AIR.N) said on Monday it would acquire a 65% controlling stake in aircraft maintenance company MRO Holdings for about $1.8 billion.

As airlines face increasing demand for aircraft maintenance services due to supply chain constraints and delays in deliveries of new aircraft, this deal will strengthen AAR's position in maintenance, repair and overhaul (MRO) and enhance its service capabilities. The company's share price rose 6% in after-hours trading.

"By acquiring MRO Holdings, we will create the world's largest heavy maintenance MRO (maintenance, repair, and overhaul) company. Our hangars will be able to serve nearly 3,000 aircraft each year," said AAR CEO John Holmes.

MRO Holdings operates aircraft maintenance and modification facilities in the United States, Mexico, El Salvador and Colombia, with about 90% of its revenue coming from sales to U.S. customers. The company's investors include private equity firm Bain Capital.

AAR will have the right, within six years after completion of the transaction, to choose to acquire the remaining 35% stake in MRO Holdings.

The Wall Street Journal earlier on Monday, citing people familiar with the matter, was the first to report the deal.

AAR plans to finance the transaction through additional debt, issuing about $780 million in equity to existing shareholders of MRO Holdings, and raising funds through private investment in public equity (PIPE).

The transaction is expected to be completed in AAR's third fiscal quarter ending February 2027, subject to regulatory approval and other customary closing conditions.

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