$20.25M at 5.0x — signed August 21.
Asset purchase at 5.0x an agreed average EBITDA of $4.05M (basis in § 03). $14.14M cash · $4M seller note (5%, bullet year 5) · up to $8.89M earn-out over years 1–3 behind EBITDA and gross-margin floors · $2.11M rolled equity with a 2x put at year 3. The DLA contract sits outside the earn-out: sellers receive 5% of its gross profit for five years. Both brothers stay three years at $300k. Working-capital true-up with a $250k collar.
After closing: an Alstra-controlled operating company holds 100% of the assets, funded roughly half with debt under the contemplated structure (~$5M senior, a mezzanine layer, the $4M seller note). The brothers become minority holders: their $2.11M roll splits evenly between the operating company and the Alstra platform — roughly 10–15% combined, depending on the final equity raise — floored by the 2x put and subject to the call if either leaves early.
- $18.1M is unconditional. The remaining ~$16M of framed seller value is contingent on performance or a DLA award.
- The DLA commission is 5% of gross profit — not the 10% that circulated internally.
- Ownership percentages are deferred to closing fair-market values, and the dilution of the sellers' roll by team carry is not yet papered — both go in the definitive documents.
A lean family distributor of aerospace hardware.
Owned 50/50 by brothers Michael (~58, finance, retiring in ~2 years) and John Kjaerulff (runs the DLA bid, staying). Distributes aerospace and defense hardware — predominantly fasteners — sourced largely on the open market and resold to primes, MROs, airlines, and EMS manufacturers worldwide. Before ~2021 the business was mainly an electronic-components broker. Small team; leased facility. Certifications held: AS9120B and ISO 13485, annual AS9120 audit just passed.
- The certifications are real; the labels around them were inflated (AS9100/ISO9001 claimed vs AS9120B/ISO13485 held; "authorized reseller" vs two admitted franchise agreements).
- Key-person weight sits with John (DLA) and Marta (Leonardo account).
Boom, bust, rebuild.
| Year | Revenue | Gross profit | GM % | Op income |
|---|---|---|---|---|
| 2018 | $15.5M | $5.2M | 33.7 | $1.27M |
| 2019 | $10.7M | $3.4M | 32.0 | $0.50M |
| 2020 | $8.2M | $2.4M | 29.9 | $0.05M |
| 2021 | $32.2M | $9.9M | 30.9 | $3.74M |
| 2022 | $90.4M | $31.2M | 34.6 | $22.11M |
| 2023 | $15.6M | $4.6M | 29.5 | $0.09M |
| 2024 | $15.2M | $4.6M | 30.2 | $0.13M |
| 2025 | $27.2M | $9.2M | 33.7 | $4.32M |
| H1 2026 | $18.0M | $6.8M | 37.5 | $3.19M |
- A ~$15M core business, a 2021–22 windfall (~$26M of profit, ~$15M distributed out), break-even as booked in 2023–24, then the aerospace ramp to a ~$36M H1-26 pace. Owner pay sits inside payroll, so owner earnings in the flat years exceed the bottom line.
- The price basis leans on the two noisiest years. As booked, 2023–25 operating income averages ~$1.5M. The $4.05M LOI basis requires the seller's FY24 opex normalization (−$1.6M) plus 2025/LTM profits — and 2025 COGS is internally broken: gross COGS $35.5M against $27.2M revenue, offset by a −$17.8M inventory adjustment (H1-26 repeats it at −$13.7M). The QoE must rebuild COGS from the item ledger.
- Cash is ~zero throughout; working capital is AR + inventory funded by the revolver ($4.5M drawn at Jun-26) and shareholder loans. ~$2.9M of shareholder loans at Dec-25 largely disappeared by Jun-26 while the revolver drew up $1.4M.
- Bookkeeping is poor: payroll liabilities frozen at $697,023.94 for 3.5 years, suspense and "Error" accounts, negative prepaids. H1-26 commission expense is $1.53M in six months vs $578k in all of 2025 — recipient unknown.
$33.6M pace — a quarter of it stopped shipping.
FY2025: $27.3M across 443 accounts. 2026 through Aug 12: $20.6M across 361 accounts, annualizing to $33.6M — the source of the seller's run-rate claim. Top-5 hold 60.9%; 27 accounts ≥$100k carry 86% of revenue.
| 2026 top 5 (Jan 1 – Aug 12) | 2026 | Share | FY 2025 |
|---|---|---|---|
| Noble Supply & Logistics | $5.26M | 25.5% | $14.44M |
| Boeing Distribution Services | $2.41M | 11.7% | $0.71M |
| SPA Air Algerie | $2.12M | 10.3% | $0.75M |
| WSK PZL (Poland) | $1.69M | 8.2% | $2.32M |
| Leonardo S.p.A. | $1.08M | 5.2% | $0.31M |
- 2025 was majority-Noble (52.8%). Noble's 2026 pace is already down ~41%, it shipped at full rate until the ~Aug 13 stop, and it owes ~$2M — largely for recent shipments. There is no direct-DLA fallback channel in the data.
- Without Noble, the business earns ~$3.3M EBITDA at current ex-Noble pace (trailing view: ~$2.5M) — below both earn-out floors until ex-Noble revenue reaches ~$31M. The ex-Noble book is genuinely up 94% vs 2025, but nearly half that growth is Boeing Distribution and Air Algerie. Debt sizing follows: at ~2x of $3.3M the deal safely carries ~$6–7M of debt, not the ~$10M contemplated.
- Air Algerie: $2.12M booked by late July, zero since — identical to the cent across the Jul-28 and Aug-12 files. A few large avionics shipments, not run-rate; historically slow payers. We hold no per-customer invoice detail — the order book and AR aging are on the request list.
- The promised new customers are not yet real in the data: Powerus $78.70, CesiumAstro $0.
- Mix (tagged top-20): aerospace 44%, government 26% (≈Noble), industrial 8%, medical 4%. Fasteners are 54% by commodity.
High-velocity, low-ticket, 40.8% clean margin.
Item-level sales Jan 1 – Aug 12, 2026: $20.6M across ~9.3M units. Top-10 items are only 20.3% of revenue — the engine is breadth, not hits.
- Clean inventory gross margin is 40.8% once one $14.0M unit-of-measure COGS artifact is removed (lacing tape costed per spool, sold per yard — acknowledged; its bulk correction is what distorts the P&L in § 03).
- 845 "Service" lines totaling $5.19M — 25% of revenue — carry zero COGS. Classification needed in the QoE.
- Excess-lot economics are real where verified: Cherry rivet lots at 58–100% gross margin.
1,476 vendors. Half the spend is open market.
$19.2M of purchases across 1,476 vendors (report window Jan '25 – ~Aug '26). Median vendor spend $1,499. Top supplier: Peerless Aerospace Fastener, $2.53M — 13.2%. Top-10 combined: 30.4%.
- Purchases (~$19.2M over ~19 months) run ~$14M below what reported COGS and rising inventory would imply — roughly the size of the known unit-of-measure artifact (§ 05). Read as corroboration of that one error, not a second finding; Cayne ties out the residual against the GL.
- Direct-OEM spend is under 10%; roughly half is brokers and open market — eBay ($125k), Amazon, Newegg, HK/China electronics brokers. Consistent with two real franchise agreements, not a "464 approved manufacturer" network. AS6081 counterfeit-screening practice matters.
- Peerless at 13.2% is the one meaningful supplier dependency — almost certainly the conduit for the Cherry rivet line.
- Oddities to ask about: several brokers with exactly-round totals (Sentry $538,000.00), an individual as a vendor, "Brooks and Maldini" $37k.
$8.6M on the books. The stories don't match it.
Book inventory at Jun 30, 2026: $9.84M gross, $1.26M reserve, $8.58M net — grown every year since 2019 while core revenue stayed flat until 2025. Separately: a 48,825-line excess stock list described by the sellers as ~$60M of fully-written-off stock.
- The numbers told to the bank ("$9.5M written down to $4.5M") do not match the books ($8.58M net, $1.26M reserve).
- A ~$60M written-off list next to an $8.6M net book value means valuation is unverifiable from these documents — perpetual ledger at cost and a physical count are on the QoE and site-visit lists.
- Implied turns ~2x — six months to a year of stock, before trusting any cost figure.
A ~$234M bid on the DLA recompete.
DLA Aviation Richmond FSG 53 recompete (SPE4A2-26-R-0002): multiple-award fixed-price IDIQ, 5+5 years, ~$443M ten-year government estimate, total small-business set-aside. Incumbent: Noble. Sonicare bid 4,127 lines — ~$234M as intended ($323.2M as first keyed; three clerical errors we helped them find and correct account for the difference).
- Sampled lines price at ~2x recent DLA awards — a partial award is the realistic good case. Award ~mid-2027; first revenue 2027–28.
- Deal linkage: sellers get 5% of DLA gross profit and DLA is excluded from the earn-out — the bid shifts seller upside, not the base price. Noble is both the incumbent and the stopped top customer: the recompete and the relationship are one story.
- Housekeeping: confirm the corrected Section B was filed before the Aug 25 change window closed.