JULIAN MOXON / PARIS
More than 50% of French group expected to be sold off after release of 2003 figures
French propulsion and equipment group Snecma is heading for privatisation in the second quarter of 2004 as it weathers an industry crisis it says is the "worst in 10 years".
Chief executive Jean-Paul Béchat says the group, one of the last remaining out of the original 21 companies earmarked by Paris in 1993 for privatisation, will probably be offered to the market after the 2003 results are presented on 24 February. "Any potential investor would want to see the latest figures before committing to purchasing shares," he says.
Flight International understands that Béchat is to brief potential investors in the City of London the day after the results are published. He declines to speculate on how much of the company, now 97.2% owned by the French government, will be sold off, but industry sources believe it will be in excess of 50%.
Béchat says that, although the aerospace industry "is going through a major crisis", Snecma is set to post 2003 sales slightly up on the €6.5 billion ($7.6 billion) figure for 2002, along with a small increase in profits. First-half figures revealed in September were, however, slightly below those for the same period in 2002, but Béchat says he "expects recovery in the second half, unless there is a disaster".
Snecma has undergone a prolonged period of acquisition and consolidation under Béchat's seven-year leadership that has seen the company double in size and diversify into aerospace equipment, now accounting for a third of consolidated sales. Its propulsion business was strengthened by the takeover in 2000 of small-engines company Turbomeca (through the acquisition of Labinal) and the development of its aircraft engine services business. This year has also seen the selection of the Snecma/NPO Saturn partnership to power the Sukhoi Russian Regional Jet and the long-awaited go-ahead for the Airbus Military A400M transport, in which Snecma partners ITP, MTU and Rolls-Royce on the TP400-D6 turboprop. Several important contracts have also been won for the Airbus A380.
Béchat is watching developments in European second-tier propulsion companies and admits to a possible interest in MTU after its sale by DaimlerChrysler to one of two private equity bidders.
Béchat says the company is "not yet significant" for Snecma, but adds that "financial concerns are unlikely to stay in the propulsion business forever
Source: Flight International
