Snecma chairman Jean–Paul Béchat says the French aerospace company is "ready and waiting" to be privatised, reacting to early indications from the country's newly-elected government that it is back on the privatisation list. The government holds 97% of Snecma's shares.
The plan to sell around 25% of the company in an initial public offering (IPO) was well on course for October 2001 but was shelved following the events of 11 September. Although there is no firm commitment to revive the sale as yet, Snecma is an attractive investment, believes Béchat.
Growth
"This company has a real value, with best-selling products which have long-term value," he says. It has also shown a good growth record, does not have large debts and has given its shareholder a E100 million ($100 million) dividend in the past two financial years.
The partial privatisation could see around half of the shares sold to investors, which could include other aerospace companies, and the other half to employees and private investors.
Béchat anticipates Snecma's turnover will fall some 10% this year, compared with the E6.9 billion level of 2001, barring further unforeseen events.
It has particularly been hit by a 30% drop in deliveries for the best-selling CFM56 engine, which it produces jointly with GE Engines.
There have however been some bright spots for the engine and aircraft systems manufacturer.
Sales of the Rolls-Royce Turbomeca RTM322 engine have been growing in momentum as the Eurocopter Tiger helicopter gains more orders, while civil helicopter engine orders have also done well. Engine orders for the Dassault Mirage and Rafale fighters have remained unchanged.
"Boeing and Airbus are now giving us figures for their 2003 deliveries and are looking at 300 aircraft [each], so this is good news," he adds.
Consolidation
At present, Snecma's business comprises 69% engines and 31% aircraft systems. "I don't say this is the ideal balance, and it could be changed if we find an opportunity for consolidation," says Béchat. "However, there are very few opportunities today."
Snecma was encouraged by banks involved in the sale of TRW to make an offer for this company, but it declined. "Some parts of that business could fit well with ours but the prices asked were too high according to our analysis," he says.
Although Béchat does not expect Farnborough to feature any large deals, he is pleased at the level of participation. "What is very interesting to me is to see everybody that is there. It shows that our aerospace industry is not in despair or in a catastrophic position."
Source: Flight Daily News
