EMS nabs Formation for in-flight Internet in $55M deal

A Georgia company that provides wireless connectivity solutions plans to enter the in-flight Internet market for airlines and business aircraft owners by buying a defense contract company for $55 million.
EMS Technologies announced today that it has agreed to acquire New Jersey-based Formation Inc. for $40 million. The amount could increase an additional $15 million if Formation hits certain financial targets.
EMS officials said the company plans to use terrestrial and satellite networks to enable in-flight passenger communications. The acquisition of Formation bolsters EMS’s aero-connectivity capabilities, enabling a far-reaching solution for passenger mobile access in the cabin.
“Acquiring Formation signals EMS’ continued investment in its aero-connectivity strategy to become a more comprehensive solutions provider,” EMS CEO Paul Domorski said in a company statement announcing the acquisition. “Our goal is to meet the growing demand for aeronautical communications from airlines and business aircraft owners, as well as governments.”
Domorski said EMS can now provide the spectrum of air-connectivity solutions, delivering platforms and systems airlines want across multiple satellite platforms.
So far, in-flight Internet for airlines is in its early stages. Aircell has numerous contracts with domestic airlines to provide its travelers with in-flight Internet service through its ground-to-air broadband network, Gogo.
Gogo acquired the spectrum for its network two years ago when it bid $31.3 million for the 3-megahertz license that was being auctioned by the FCC. American Airlines and Virgin America are offering Gogo on select flights. Delta Air Lines and Air Canada have deals with Aircell to launch in-flight Internet services on their aircraft next year.
Formation will continue to be led by CEO R. Nim Evatt, who will report to Mackay.
Formation designs and manufactures hardware and software products and provides engineering services for the defense, aviation, data communications and transportation industries.