US aluminium producer Alcoa has acquired Fairchild Fasteners for $657 million in cash, taking advantage of the downturn in civil aircraft production. The Fairchild business will be combined with the company's Huck unit to create Alcoa Fastening Systems, with annual revenues of $1 billion. Fairchild will use the sale proceeds to reduce debt. Final purchase price could change based on net working capital at closure, expected by 30 November, and Fairchild could receive up to an additional $50 million tied to Airbus and Boeing commercial aircraft deliveries from 2003 to 2006. Fairchild Fasteners had revenues of $571 million last year and earnings of $80 million. The acquisition will increase Alcoa's presence in the aftermarket for fasteners used in aircraft maintenance and repair, where Fairchild is a leading supplier. In 2000, Fairchild estimated it had 40% of a total aerospace fastener market worth $1.4 billion annually. The combination of Fairchild and Huck should make Alcoa the dominant supplier.

Source: Flight International