Brian Dunn/MONTREAL
ROLLS-ROYCE Industries Canada is selling its Bristol Aerospace division, saying that the Winnipeg-based company no longer fits its long-term plans.
The 30-year-old relationship with Bristol is being cut to allow Montreal-based R-R Canada to concentrate on its main businesses of manufacturing aircraft and industrial engine components.
The sale is part of a continuing R-R review of its businesses, which has seen the UK company put its Parsons Power Generation Systems and International Combustion subsidiaries up for sale. Several companies are now at the "due diligence" stage in the possible purchase of those ú230 million ($360 million)-turnover activities.
Bristol's main businesses are the repair, upgrade and overhaul of aircraft, the manufacture of engine and aircraft components, and the production of missiles and rockets for military and space programmes. The company also makes military targets and wire-strike-protection systems for helicopters.
The company's workforce has more than halved in size (to 960 people, from a peak of 1,950 people in 1992) as a result of aerospace and defence cuts. In 1995 it accounted for sales of C$74 million ($55 million) of R-R Canada's C$450 million turnover in 1995. In 1992, Bristol sales were C$177 million.
The company's rockets, targets and wire-strike-protection businesses are doing well, but the aircraft repair and overhaul division is struggling, says a Manitoba government official.
Investment bank Rothschild Canada has been hired to look for a buyer. Although it has not yet been approached, Bombardier says that, as an aerospace company, it is always looking for potential deals.
Bristol is likely to attract a US buyer, according to Peter Smith, president of the Aerospace Industries Association of Canada. He says that it is possible that Bristol could be split up and sold.
"I can't see a natural mix among my members. Bristol offers a diversity of businesses, and I don't think Bombardier would be interested in all of them. I see many advantages for a US company working in Canada, however, especially with our current dollar and labour rates," Smith says.
Source: Flight International
