Just weeks after Greenwich Air Services agreed to buy UNC to create the world's largest independent engine-maintenance business, General Electric has stepped in to buy both groups.
The acquisition of Greenwich/UNC, which is due to be completed within the next six months, would give GE Engine Services sales of around $4.5 billion and a dominant position in the engine-overhaul industry. GE would emerge with around 16%of the world market for aviation, airframe and engine services, which is estimated to be worth around $28 billion.
All three have grown aggressively in the past five years through a series of major acquisitions. In 1996 alone, GE added Brazil's CELMA repair centre and took control of the Malaysia Airlines (MAS) overhaul centre; Greenwich acquired Aviall's commercial-aircraft repair operation; and UNC completed the purchase of the Garret Aviation Services division for corporate-aircraft engines.
Those deals were followed in February with Greenwich announcing that it was to take over UNC, to create a business with sales of around $1.8 billion and 10,000 staff (Flight International, 26 February-4 March). GE says that it saw the opportunity to accelerate the growth of its own repair business - which in 1996 posted sales of around $2.3 billion and had 6,200 staff - with an acquisition which is almost entirely complementary to its own.
UNC brings sales of around $600 million in the corporate-aircraft sector through its Garret arm and a presence on 100 military bases around the world. Among its commercial business, Greenwich also provides GE with a European centre of excellence for maintenance of its CF6 engines at the Caledonian centre, acquired as part of Aviall.
Engine Services already accounted for more than one-third of GE's $6.3 billion sales in 1996, and is reported to have contributed as much as three-quarters of its $1.2 billion in operating profits. Following the latest acquisition, the unit would be on course to make up half of sales at GE Aircraft Engines, a target which had been set for the end of the century.
Source: Flight International
