Acquisition provides AAR with robust capabilities to provide
worldwide aviation services to government agencies.

•  Supports the U.S. Government’s requirement for critical airlift services
•  Enhances AAR’s engineering and modifications capabilities
•  Leverages AAR’s existing aircraft maintenance and supply chain/logistics businesses

WOOD DALE, ILLINOIS (March 25, 2010) — AAR CORP. (NYSE: AIR) announced today that it has signed an agreement to acquire Aviation Worldwide Services (AWS), a leading provider of expeditionary airlift services and aircraft modifications to the U.S. and other government customers, from Xe Services LLC. AAR is acquiring the business as part of its long-term strategy to expand its products, services and capabilities in support of government customers in the United States and abroad.

AWS, through its operating subsidiaries, Presidential Airways and STI Aviation, provides fixed- and rotary-wing flight operations, transporting personnel and cargo in support of worldwide U.S. Department of Defense and Department of State deployments, and performs engineering and design modifications on rotary-wing aircraft for government customers. AWS operates a fleet of 58 customized aircraft, of which 17 fixed-wing and 21 rotary-wing aircraft are currently deployed and 20 rotary-wing aircraft are available for future deployment.

The purchase price of the acquisition is $200 million, funded through a combination of available cash, a new 270-day syndicated credit facility and a five-year term loan secured against certain aircraft. Based on the current operating fleet, the business is expected to generate approximately $175 million of revenue on an annual basis and be accretive to earnings and margins within its first year of ownership. The Company expects the acquisition to be completed during the month of April, subject to customary closing conditions. Read Full Press Release.