WASHINGTON (dpa-AFX) - TransDigm Group Inc. (TDG) said it has adjusted its estimated shipping levels and will reduce its workforce by up to 15%, as it expects significant decreases in demand across its commercial aerospace business and expects this trend will continue in the coming months.
The company has also withdrawn its financial guidance for the fiscal year ending September 30, 2020, due to uncertainty around the ultimate impact of COVID-19 on global market and economic conditions.
TransDigm also currently anticipates implementing one to two week furloughs at many locations over approximately the next six months in response to business unit specific situations.
The company noted that the impacted domestic employees will receive a substantial lump sum payment upon their departure based on their tenure and will receive an additional $4,000 to defray expenses associated with health care costs, job-search costs or for any other purpose.
TransDigm's senior management team will substantially reduce their cash compensation for the balance of 2020. TransDigm's President and Chief Executive Officer, Kevin Stein, is reducing his cash compensation by over 50% and other senior executives will also substantially reduce their cash compensation as well. Members of TransDigm's Board of Directors will forgo their annual cash board fees.
TransDigm Group announced that its wholly-owned subsidiary, TransDigm Inc., is planning to offer senior secured notes in a private offering.
It is expected that the Notes will be guaranteed, with certain exceptions, by TransDigm Group, TransDigm UK Holdings plc and all of TransDigm Inc.'s existing and future U.S. subsidiaries on a senior secured basis.
TransDigm Group expects to use the net proceeds from the offering of the Notes for general corporate purposes, including further increasing its liquidity.
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