Andrzej Jeziorski/SINGAPORE

Aerospace Industries of Malaysia (AIM), owner of maintenance and conversions specialist Airod, is to take a stake in the SME Group, advancing the consolidation of the Malaysian industry.

The move follows the installation by the Malaysian Government of Ahmad Johan as managing director of SME, parent of aerostructures company SME Aerospace and aircraft manufacturer SME Aviation. Ahmad is already chairman of AIM and chairman and president of Airod, having acquired control from Malaysia Helicopter Services in 1997 via his company PJS Industries. He will, therefore, have management control of most of Malaysia's aerospace sector.

Industry sources suggest Prime Minister Mahathir Mohammed sanctioned Ahmed's appointment at SME, with AIM set to finalise its investment "in the next few months". SME is majority-owned by government investment arm Khazanah, which also owns a stake in AIM, but sources say Mahathir wants a change in ownership "because Khazanah is purely an investment arm, and is not business-orientated".

The moves come as Airod prepares for an initial public offering on the Kuala Lumpur Stock Exchange, due next month. The company says it has won a contract to carry out a fuselage stretch on two Royal Malaysian Air Force (TUDM) Lockheed Martin C-130H Hercules transports, with four more to be modified in a later deal. Work begins next month.

The TUDM is also considering a C-130 avionics upgrade using either a Honeywell or Collins suite, and Airod is hoping for an order in time to allow the work to be done while the aircraft are grounded for stretching. Airod is also aiming to become a regional maintenance centre for Mil Mi-17 helicopters. So far, Malaysia has bought two Mi-17s, with further orders under discussion. Airod says 10 helicopters could be ordered for fire-fighting.

Source: Flight International