GE to buy the aerospace-parts business of Italy's Avio for $4.3 bn
21 December 2012
General Electric Co (GE), the world's biggest maker of jet engines, today said that it will acquire the aerospace-parts business of Italy's Avio SpA from British private equity firm Cinven and Italian conglomerate Finmeccanica Group, for $4.3 billion.
The deal does not include the Italian company's space assets.
''This acquisition is a great strategic fit with our existing portfolio,'' David Joyce, president and chief executive of GE Aviation, a GE unit, said in a statement. ''Avio has technologies, capabilities and outstanding engineers to help grow our business.''
The purchase values Avio at 8.5 times estimated earnings for 2012 before interest, tax, depreciation and amortization, according to Fairfield, Connecticut-based GE.
Cinven had acquired a majority stake in Turin, Italy-based Avio for more than $3.3 billion in 2006 from private equity firm Carlyle Group and Finmeccanica. Cinven holds an 81-per cent stake in Avio and the remaining 19 per cent is held by Finmeccanica.
Cinven had to abandon its plans to take Avio public this year, due to unsettled global economic conditions, especially in Europe.