Douglas Barrie/LONDON

Last minute attempts by French interests to court Italian helicopter manufacturer Agusta have fallen on deaf ears, with owner Finmeccanica throwing its lot in with longstanding partner GKN Westland.

GKN and state owned Finmeccanica announced on 16 May that a merger of their respective helicopter subsidiaries is being actively pursued after the signing of a memorandum of understanding covering "exclusive negotiations" between the two.

GKN Westland is understood to have remained nervous, almost until the Italian signature was secure, that high level political pressure could have resulted in Finmeccanica looking to Franco-German Eurocopter as a partner for Agusta.

Eurocopter has made little secret of its ambition to take Agusta on board, and has been increasingly open on the subject since the start of 1998. A senior French Government delegation visited their Italian counterparts earlier this month, with the restructuring of the defence aerospace sector on the agenda.

GKN Westland and Agusta are already partners in the EH Industries EH101 military helicopter programme being developed for the Italian and Royal Navies, as well as in military utility and civil variants. A link between the two has been on the agenda for years, but had been delayed by the long running restructuring of the Italian aerospace industry. It received a boost from the Italian Government's renewed drive for privatisations, including sell-offs by Finmeccanica.

Any merger of Agusta and GKN Westland, however, is unlikely to mark the end of consolidation in the helicopter sector. In a joint statement, the companies note that"-it is important for the competitiveness of the European helicopter industry that it participates in the consolidation of the aerospace and defence industry".

Company sources suggest that an eventual tie-up with Eurocopter has not been ruled out. Pulling together Agusta's and GKN Westland's assets, they suggest, would allow negotiations to be undertaken from "a position of relative strength".

Agusta is already a partner in the NH Industries NH90 medium lift military utility helicopter programme, with Eurocopter France and Eurocopter Germany.

Source: Flight International