In the first quarter of this year, there were 56 merger and acquisition deals announced, according to Irvine, Calif.-based aerospace investment bank Janes Capital Partners. This was a 14-percent increase from last year.

"We are on the cusp of a major merger wave in aerospace and defense," said Stephen Perry, managing director at Janes. "As budgets decline, it's very logical for these firms to go out looking for ways to combine businesses."

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