Rockwell Collins is in talks with Connexion by Boeing over supplying hardware for the company's airborne internet service, reveals Clay Jones, president and chief executive of the newly independent avionics manufacturer. Supplying hardware and software to "e-enable" aircraft is one of the major growth areas seen for the company, which was spun off by Rockwell International on 2 July.
Supplying avionics to equip aircraft for the "free flight" future air navigation system and providing service support to customers are also seen as major growth areas, says Jones. The Cedar Rapids, Iowa-based company begins independent operations with sales of around $3 billion and is projecting "high single-digit" growth in revenues.
The new approach to the airborne internet market differs from Collins' earlier attempt to become a service provider with the In-Flight Network (IFN) joint venture with News Corp, which was shut down earlier this year. "We gave it a go with IFN, but the market did not develop as we thought and our position was not as strong as we hoped," says Jones. "So we have gone back to what we know best, which is supplying hardware and software to service providers."
Trading in Collins' shares since 2 July give the company a "fairly substantial" market capitalisation of over $4 billion, says Jones.
The company has a $1 billion credit facility and a debt-to-capital ratio of around 20%, giving it the financial capability to continue making "bolt-on" acquisitions at the current rate of one or two a year, he says.
Source: Flight International
