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Aviation History
2000
2000-1 - 0657.PDF
Merger delivers for BFGoodrich GRAHAM WARWICK/WASHINGTON DC BFGoodrich is ahead of sched ule in its integration of the for mer Coltec Industries, which it bought for $2.2 billion in July last year, and expects to extract antici pated savings earlier than expected. The Charlotte, North Carolina- based parts and repair specialist initially projected post-merger savings of $60 million after three years, with $25 million coming from consolidation at corporate level and $35 million from opera tions, mostly in landing gear. BFGoodrich Aerospace president Marshall Larsen says the latter saving should now come early. "We said integration would take the hard work in landing gear, but 36 months, with the lion's share of we are well on the way." Marshall Larsen: early savings Aerospace now accounts for 64% of revenues, and the for mer Coltec engineered indus trial products business almost 13%. The balance comes from the performance materi als sector, which will be sold. BFGoodrich sales to air- framers are declining as Boeing production rates fall, but aftermarket business is growing as fleets expand. Sales to Airbus are relatively flat, but the company hopes to win more business. Tight margins in the heavy maintenance business have also caused BFGoodrich to refocus on airliner modification and, recently, business jet completions "where the value added is higher". Gandalf targets Meridiana after successful capital expansion move ITALIAN REGIONAL Gandalf Airlines claims it may make a move for the far larger Meridiana as it seeks a partner to aid its growth strategy. Bergamo-based Gandalf has taken heavy losses since its launch last year, but has completed the expansion of its capital base in a move which will help fund growth. Gandalf chief Luciano di Fazio says the new resources will allow it to double its fleet and find a strong partner, with Meridiana, Italy's sec ond largest carrier, among poten tial targets. Meridiana is up for sale, with its 79% owner, the Aga Khan, planning to pull out. Several flag-carriers have shown an interest in Meridiana, although recent events may eliminate some. British Airways, for example, recently launched its own National Jets Italia franchise, and is in talks to merge with KLM in a move that could eliminate the Dutch carrier as a possible buyer. Air France, meanwhile, is regarded as a possi ble partner for Italian flag-carrier Alitalia. SAir already has Italian operations - soon-to-merge Air Europe and Volare - and Luft hansa has a stake in Air Dolomiti. The expansion of Gandalf's cap ital to 55 billion lire ($26 million), raising 30 billion lire, saw most existing shareholders buying more shares, while a second stake offered was fully subscribed. Gandalf needs cash to add to its six Fairchild Dornier 328JETs (three more arrive before year end) and four 328-200 turboprops. Flight biter- national sister publication Air Transport Intelligence says the airline may also take over two undisclosed Italian 328 operators, and is look ing at larger aircraft. Gandalf lost 9.9 billion lire on sales of 17 billion lire last year, a sit uation which worsened this year, with first half losses of 8.5 billion.3 Landing gear was the only area of significant overlap between the merged companies, and other businesses acquired, including air craft seating, engine components and coatings, "fit well", Larsen says. The only Coltec aerospace busi ness not growing is the Chandler Evans full-authority digital engine control unit, but Larsen says there are no plans to divest any of the new- units, and that a new strategy will be devised for it, involving "work ing more with engine companies". BFGoodrich is "never off' the acquisition trail, he adds, pointing out the company has recently entered the space components business through acquisitions. 3 PEOPLE ++ Bernado Quintero Balcazar has been named president of Colombian carrier Avianca follow ing the resignation of Gustavo Alberto Lenis. Balcazar joins the airline from the investment banking industry. ++ Delta Air Lines has promoted Michele Burns. currently senior vice-president (VP) finance and treasurer, to executive VP and chief financial officer follow ing the departure of Edward West to an internet company. Anthony Charaf vice-president of mainte nance at the airline, becomes senior VP of cargo unit, Delta Air Logistics. ++ New York-based ITT Industries has named Henry Driesse as president of its Virginia based defence business, a special ist in electronics, communications and opto-electronics technology. Abacus counts the cost of deceiving CRS company Worldspan in favour of rival Sabre AN ARBITRATION tribunal has awarded computer reser vations (CRS) company World- span - owned by Delta Air Lines, Northwest Airlines and Trans World Airlines - damages and costs exceeding S40 million in its dispute with Singapore-based Abacus Distribution Systems. Acting under the authority of the International Chamber of Commerce (ICC), the London tri bunal concluded Abacus, owned by Singapore Airlines, Cathay Pacific- Airways, China Airlines, All Nippon Airways and others, deceived Worldspan about secret talks with rival CRS company Sabre, then a subsidiary of AMR. In the earlv 1990s, Abacus selected Worldspan to host its CRS and agreed to market its distribu tion services in Asia. The two ex changed 5% equity stakes, but a row began when Abacus switched allegiance to Sabre. Worldspan began arbitration moves in 1998. In addition to finding Abacus liable for fraud, the tribunal con cluded the company disclosed pro prietary Worldspan information to Dallas-based Sabre, and breached •its contract with the Atlanta, Georgia-based firm. Worldspan president Paul Blackney now plans to take US court action against Sabre. Worldspan is leading the industry's transition to web-based travel information distribution via links with on-line travel agents. Q FLIGHT INTERNATIONAL 15 - 21 August 2000 19
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