Julian Moxon/PARIS

A major regrouping in France's solid rocket propulsion business has been agreed by Snecma and powder propellant specialist SNPE, with the engine giant also understood to be moving closer to sealing a major European engine alliance taking in Germany's MTU, Italy's Fiat Avio and Sweden's Volvo Aero.

Snecma and SNPE will create a new company with around €500 million ($444 million) of annual sales. It will be equally owned and will merge Snecma's solid propulsion business with SNPE's energetic materials activities, resulting in the largest such entity in Europe and the third largest in the world.

The as-yet unnamed company will take over Snecma/SNPE activities in launch vehicles and space propulsion; strategic and tactical missiles propulsion; explosives and propellants; pyromechanisms, propellants and high performance composite materials. The deal should be finalised in early 2001.

Sources say a further development will see Celerg, the 50/50 EADS/SNPE tactical missiles/ ramjet subsidiary, transformed into "New Celerg", with 50% owned by Snecma/SNPE and the rest by "new Matra BAe Dynamics", BAE Systems subsidiary Royal Ordnance and Germany's Bayern Chemie.

The move furthers Snecma expansion into the private sector, following the absorption of small turbines specialist Turbomeca and thrust reverser and aerostructures manufacturer Hurel Dubois. Industry sources now say that Snecma president Jean-Paul Béchat is hoping to form an engine grouping bringing together MTU, Fiat Avio and Volvo Aero.

Béchat says Snecma, the world's fourth largest engine manufacturer, "will not be privatised for privatisation's sake", but only through "evolutions of capital structure". The bringing together of Snecma, MTU, Fiat and Rolls-Royce to power the A400Mmilitary transport is seen as a prelude to possible European engine rationalisation, though R-R, which competes with Snecma on both civil and military engines, is unlikely to be included.

Source: Flight International