Precision Castparts (PCC) is to acquire aerospace fastener manufacturer Shur-Lok for $110 million, less than two months after the component supplier agreed to buy superalloy specialist Special Metals (SMC) in another cash deal worth $540 million. Both transactions are expected to close by the end of January.
Portland, Oregon-based PCC says the acquisition of privately held Shur-Lok will expand its critical aerospace fastener portfolio, adding to its March purchase of Air Industries (AIC) and its $294 million takeover of SPS Technologies in 2003. Shur-Lok employs 270 people in Irvine, California and Petit-Rechain, Belgium.
In addition to fasteners, PCC produces castings and forgings for the aerospace, automotive, power-generation and industrial markets. The company says the SMC acquisition will provide an internal supply of nickel-based alloy billet for its forging operations, reducing costs and decreasing lead times in moving from raw material to finished product.
PCC had sales in its 2004-5 fiscal year of $2.92 billion, 55% from aerospace, while SMC had 2004 calendar year sales of $730 million.
Even before these latest acquisitions are complete, PCC has announced increased sales and earnings for its FY2006 second quarter ended 2 October. Revenues were up more than 25% year-on-year to $875 million, and net income for the second quarter was $81 million compared with a net loss of $183 million for the same period last year. Increased commercial aircraft and engine production and higher after-market activity, including engine overhauls, boosted business.
GRAHAM WARWICK/WASHINGTON DC
Source: Flight International