Business Valuation: Aerospace, Security & Defence

The average Swiss Aerospace, Security & Defence company is valued at 5.0 - 7.5× EBITDA on a statutory (tax-based) basis and 7.0 - 10.0× EBITDA in actual deal transactions. The spread between statutory and deal multiples represents a key arbitrage opportunity for informed buyers. The current market trend is rising, with an arbitrage gap rated as medium. Actual valuations depend heavily on recurring revenue share, customer diversification, management depth, and equipment modernity.

Key valuation drivers include: The strongest domestic procurement pipeline in a generation: the Armeebotschaft 2026 of 20 March 2026 requests roughly CHF 3.4 billion in commitment credits, and parliament has resolved to raise army spending to 1% of GDP; A binding offset regime that channels foreign programme spending into Swiss firms. armasuisse requires Lockheed Martin to compensate 60% of the F-35A contract value in Switzerland, a CHF 2.9 billion offset volume, and the 2026 armament programme is expected to place about CHF 1 billion of orders and CHF 990 million of compensation business with Swiss industry. Factors that can compress valuations include: Defence demand is not aerospace demand, and the register proves it: RUAG Aerostructures Schweiz AG, the Emmen civil aircraft structures business, has been in liquidation since SHAB of 17 April 2026; No official Swiss aerospace and defence turnover series exists. Any market size, company count or growth rate for the sector as a whole — including the ones in this report — is an estimate; only the SECO war materiel export statistic and BFS STATENT at division level are measured. Deal multiples typically range from 7.0 - 10.0× EBITDA, but actual prices vary significantly based on customer concentration, management quality, revenue predictability, and geographic reach within Switzerland's 26 cantons.

There is no official count of Swiss aerospace and defence companies. The measured core is BFS STATENT 2024, published 20 August 2026, which records 290 establishments and 13,699 employees in NOGA division 30 "other transport equipment" — the division containing aircraft and spacecraft manufacture, alongside rail and shipbuilding. That is up from 282 establishments in 2022 and 243 in 2012, one of the very few MEM-adjacent divisions still growing. Weapons, ammunition and military vehicle production sit in other NOGA divisions, so the wider figure of roughly 950 firms across aerospace, defence and their supply chains remains an estimate rather than a measurement. Two published series do give hard numbers: SECO recorded CHF 946.3 million of Swiss war materiel exports in 2025, up 42.4% on 2024, and armasuisse reports that just under 400 Swiss companies — around three-quarters of them SMEs — benefited from offsets during the F/A-18 programme. The commercial register is the check on any individual name: RUAG Aerostructures Schweiz AG, for instance, has been in liquidation since SHAB of 17 April 2026.

Swiss aerospace and defence SMEs are approaching succession at the most favourable demand moment in a generation, and the two facts are in tension. The Armeebotschaft 2026 of 20 March 2026 puts roughly CHF 3.4 billion of commitment credits before parliament, SECO recorded a 42.4% jump in Swiss war materiel exports in 2025, and the F-35A offset obligation alone directs CHF 2.9 billion of Lockheed Martin contract value into Swiss orders. What a buyer is actually acquiring, though, is certification and programme standing: EASA Part 21/145 approvals, NADCAP accreditations, prime qualification and offset eligibility take years to establish and are held together by a small number of people. A founder who leaves without a documented handover can take audit history, approval-holder continuity and the prime relationship with them, and none of it is replaceable within a fiscal year. The buyer pool is unusually deep for a niche this size, and it is strategic rather than financial: General Dynamics already owns both Mowag in Kreuzlingen and Jet Aviation in Basel, Rheinmetall Air Defence sits in Zurich, and Leonardo holds kopter group ag in Glarus Nord — all of them capable of absorbing a certified Swiss supplier directly. The countervailing evidence sits in the same register: RUAG Aerostructures Schweiz AG, the Emmen civil aircraft structures business, has been in liquidation since SHAB of 17 April 2026, a reminder that defence demand and civil aerostructures demand are not the same thing. Owners should treat approval-holder continuity as the first item of any succession plan, allow two to three years of overlap, and price on the current procurement cycle rather than on an assumption that it repeats. Deal multiples for the sector typically run 7.0 - 10.0× EBITDA.

Four trends define the sector in 2026: (1) Swiss war materiel exports jumped 42.4% in 2025 — SECO's raw export data, published 10 March 2026, records CHF 946.3 million of Swiss war materiel exports for 2025 against CHF 664.7 million in 2024. (2) The Armeebotschaft 2026 puts CHF 3.4 billion in front of parliament — Published 20 March 2026, the Armeebotschaft 2026 requests three commitment credits totalling roughly CHF 3.4 billion: about CHF 2.4 billion for armament procurement, CHF 394 million as an additional credit for the F-35A and CHF 562 million for VBS real estate. (3) The offset arithmetic, corrected: CHF 2.9 billion, not CHF 3.7 billion — armasuisse requires Lockheed Martin to compensate 60% of the F-35A contract value through orders placed in Switzerland, giving a total offset volume of CHF 2.9 billion, plus CHF 67 million of direct federal orders to Swiss industry. (4) Defence is up, civil aerostructures is not — RUAG Aerostructures Schweiz AG, the Emmen business making civil aircraft structures, has been in liquidation since SHAB of 17 April 2026.

The principal acquisition risks are: (1) Input cost escalation the buyer cannot control. The Armeebotschaft 2026 market chapter reports Western firms' ammunition up roughly half in price since the war in Ukraine began, artillery shell prices multiplied, and European production capacity expanding only slowly; (2) Programme resizing risk, demonstrated on the largest Swiss programme itself: the F-35A additional credit requested in March 2026 is framed as enabling an expected 30 aircraft, and calculated 30-year operating costs of about CHF 9.4 billion are roughly double the acquisition spend; (3) US tariff escalation through 2025-2026 — 39% in August 2025, capped at 15% in November 2025, Section 232 steel, aluminium and copper duties of 10-50% from April 2026 — raises the cost of qualified metals for Swiss suppliers. Buyers should conduct thorough due diligence on customer concentration, regulatory compliance, and key-person dependencies. Deal multiples of 7.0 - 10.0× EBITDA may be discounted for firms with elevated risk profiles.

The typical cost breakdown for a Swiss Aerospace, Security & Defence firm is: Materials & Certified Components: 30%, Personnel Costs (highly qualified workforce): 33%, Quality Assurance & Certification: 9%, Equipment Depreciation & Tooling: 10%, Other Operating Costs (insurance, compliance): 11%, Profit Margin (EBITDA): 7%. Indicative split for a certified Swiss aerospace or defence supplier. Certified materials and components dominate because aerospace-grade metal and qualified parts cannot be substituted on price, and the Armeebotschaft 2026 market chapter reports Western firms' ammunition roughly half again as expensive since the war in Ukraine began, with artillery shell prices multiplied and European production capacity expanding only slowly. Quality assurance and certification carry a share that would be unusual elsewhere in the MEM sector, because EASA Part 21/145 approvals and NADCAP accreditation are recurring costs, not one-off ones. Swissmem reported tech industry capacity utilisation of 81.1% in Q2 2026 against a long-run average of 85.6% (2015-2025); defence-side suppliers are running against lead times rather than demand, and NOGA division 30 added 14.5% employment between STATENT 2022 and 2024. These benchmarks are important for buyers assessing operational efficiency and margin improvement potential post-acquisition.

Switzerland's main Aerospace, Security & Defence clusters are: (1) Central Switzerland (NW, LU) — The aircraft-building core. PILATUS Flugzeugwerke AG in Stans (NW) is the only Swiss manufacturer of complete aircraft, and RUAG AG is registered in Emmen (LU) alongside the military airfield. (2) Greater Zurich and Thurgau (ZH, TG) — Defence systems and commercial MRO. Rheinmetall Air Defence AG is registered in Zurich and supplies exactly the ground-based air defence capability prioritised in the 2026 armament programme; General Dynamics European Land Systems - Mowag GmbH builds armoured wheeled vehicles in Kreuzlingen (TG); SR Technics Switzerland AG runs independent airframe, engine and component MRO at Zurich Airport. (3) Bern and the Mittelland (BE, SO) — Federal defence administration and precision supply. RUAG International Holding AG and RUAG MRO Holding AG are registered in Bern, close to armasuisse and the VBS, while the Solothurn precision belt supplies the tier-two work — Mecaplex AG in Grenchen makes aircraft canopies, windshields and cabin windows. (4) Basel and Valais (BS, VS) — Completions and certified materials. Jet Aviation AG in Basel is one of the largest business aviation completion and maintenance operations in Europe, with registered branches at Geneva Airport and Zurich-Kloten. Regional concentration affects valuations, as companies in established clusters benefit from supplier ecosystems, specialized talent pools, and industry networks.