Speculation is swirling around Boeing efforts to sell its Wichita, Kansas commercial operations after the UK's GKN confirmed it had pulled out of the bidding and reports suggested Canadian investment firm Onex had emerged as the frontrunner.
GKN was considered the most likely buyer of the Wichita operation, as well as plants in Oklahoma, because of its purchase in 2000 of Boeing's military fabrication facility in St Louis, Missouri. Onex, meanwhile, has cash to spend, but lacks the experience in the aerostructures sector of the other reported bidder, Vought Aircraft Industries.
GKN confirms its withdrawal, but neither Onex or Vought will comment. "We are no longer part of the bidding process," GKN says. The UK company initially withdrew from contention in May, but re-entered the bidding in September after Boeing lowered the price, reportedly to around $2 billion. GKN says it put in a non-binding "indicative" offer that it did not expect to be pursued.
Unconfirmed reports suggest GKN and Vought, which is owned by US investment firm the Carlyle Group, have been outbid by Toronto-based Onex. The Canadian investment firm's portfolio has several large US companies, but its only aerospace holding, through its Oncap small-capital fund, is avionics specialist CMC Electronics.
Boeing says commercial-aircraft work, including aerostructures for the 7E7, will stay in Wichita, but the company will expect a buyer to sign for year-on-year cost reductions similar to those agreed to by GKN when it bought the St Louis plant. A deal is expected by year-end, but Boeing says it will keep Wichita and Oklahoma if a buyer is not found.
Source: Flight International
