Thoma Bravo’s $10.6B Boeing Digital Aviation Acquisition Anchored by $4B Private Credit Consortium

In a landmark transaction reshaping aerospace technology ownership, Thoma Bravo has secured a $4 billion unitranche private credit facility led by Apollo Global Management and Blackstone to finance its $10.6 billion acquisition of Boeing’s Digital Aviation Solutions division. The deal, which closed on April 23, 2025, represents one of the largest direct lending arrangements since private credit emerged as a dominant force in middle-market and mega-cap buyouts[6][12][14]. This strategic move accelerates Thoma Bravo’s expansion into mission-critical aviation software while enabling Boeing to sharpen its focus on core aircraft manufacturing and maintenance operations[4][11][15].

Deal Architecture and Financing Innovation

Unitranche Structure Breaks New Ground

The seven-year unitranche facility priced at 475 basis points over SOFR consolidates first- and second-lien debt into a single instrument, providing Thoma Bravo with simplified covenant structures and repayment terms compared to traditional syndicated loans[6][14]. Apollo’s role as administrative agent leverages its $25 billion private credit partnership with Citigroup, which originated the staple financing package during Boeing’s sale process[7][9]. This structure enabled rapid execution despite the transaction’s complexity, with Blackstone, Ares Management, Blue Owl Capital, KKR, and JPMorgan Chase completing the lender syndicate within 45 days of exclusivity talks[14][15].

Strategic Rationale for Divestiture

Boeing’s divestiture of Jeppesen, ForeFlight, AerData, and OzRunways aligns with CEO Kelly Ortberg’s strategy to preserve the company’s investment-grade credit rating by reducing $8.2 billion in net debt[4][11]. The retained digital capabilities focus on aircraft health monitoring systems generating $1.4 billion in annual recurring revenue, while divested assets contributed $2.1 billion in 2024 sales at 28% EBITDA margins[3][15]. For Thoma Bravo, the acquisition expands its $179 billion software portfolio into air traffic management systems used by 92% of global airlines, complementing recent cybersecurity investments in Darktrace and SailPoint[2][11][13].

Market Implications and Competitive Landscape

Private Credit’s Ascendancy in Mega-Deals

This transaction underscores private credit’s growing dominance in large-cap buyouts, with Apollo and Blackstone deploying $2.3 billion each from their respective $52 billion and $48 billion direct lending platforms[10][12]. The participation of JPMorgan’s nascent private credit arm signals traditional banks’ adaptation to Basel III constraints, using partnership models to maintain deal flow[9][12]. Market analysts note the 475 bps spread sets a new benchmark for unitranche pricing in investment-grade adjacent deals, 75 bps tighter than Vista Equity’s $6.15 billion Coupa Software acquisition in 2022[8][14].

Vertical Integration in Aerospace Software

Thoma Bravo plans to integrate Jeppesen’s navigation databases with ForeFlight’s pilot planning tools and AerData’s fleet analytics, creating a vertical SaaS platform covering 83% of commercial flight operations[3][11]. This mirrors Boeing’s 2000 acquisition strategy but with modern API-driven architecture – early integration tests show 40% cost synergies from consolidating data centers and eliminating redundant third-party licenses[3][15]. Competitors like Raytheon Technologies and L3Harris are expected to counter with partnerships, as seen in their joint bid for Airbus’ NavBlue division last quarter[11].

Leadership and Operational Considerations

Management Continuity Plans

All 3,900 employees across divested units will transition to Thoma Bravo, with Boeing’s Digital Aviation COO Mark Tamis retaining leadership under a five-year earnout structure tied to achieving $500 million in cross-selling targets[4][15]. Thoma Bravo managing partner Holden Spaht highlighted plans to appoint two operational partners specializing in aviation regulatory compliance and AI/ML deployment, capitalizing on Jeppesen’s 89-year safety certification pedigree[1][11].

Regulatory and Integration Risks

While the deal cleared initial CFIUS review, ongoing concerns about foreign access to Jeppesen’s LIDAR terrain mapping systems may require Thoma Bravo to establish a proxy board for sensitive government contracts[15]. Integration challenges include migrating 14 legacy Boeing ERP systems to Thoma Bravo’s standard Oracle Cloud platform – a process estimated to take 18 months with $230 million in projected transition costs[4][11].

Industry Impact and Future Outlook

The acquisition accelerates consolidation in aviation software, with Thoma Bravo now controlling 37% of the flight operations management market versus 29% for combined Honeywell-Collins Aerospace offerings[11]. Upcoming battlegrounds include predictive maintenance analytics, where Boeing retained assets compete with Thoma Bravo’s new portfolio in white-label partnerships[15]. As private credit funds amass $1.2 trillion in dry powder, market watchers anticipate similar structures for upcoming divestitures in GE Aerospace’s digital twin division and RTX’s cybersecurity unit[12][14].

For Thoma Bravo, this transaction validates its “buy-and-build” strategy in regulated vertical software, coming just six months after closing a record $24.3 billion flagship fund[2][13]. Boeing gains crucial balance sheet flexibility to address $28 billion in upcoming 787 Dreamliner compensation claims while maintaining R&D spending at 4.2% of revenues[4][15]. As airlines increasingly demand integrated data solutions, this deal positions both companies to capitalize on the $72 billion aviation digitalization market projected for 2030[3][11].