GE to sign Avio deal on Thursday, will not buy space ops: sources
MILAN (Reuters) - General Electric (GE.N) is set to sign on Thursday a deal to buy Italian aerospace supplier Avio excluding its space division, sources close to the talks said.
"GE is expected to buy the non-space assets," one of the sources said. The deal is expected to be worth around 3 billion euros ($4 billion), sources close to the situation told Reuters this week.
Turin-based Avio, which supplies engine parts for Eurofighter Typhoons and also to engine makers GE and Rolls-Royce (RR.L), is owned by BCV Investments, in which Cinven private equity has a majority.
Italian defense group Finmeccanica (SIFI.MI) owns around 14 percent of Avio, which had revenues of more than 2 billion euros in 2011.
The sources said the deal with GE will be signed on Thursday and formally announced on Friday.
Cinven bought Avio in 2006 in a deal that valued it at about 2.6 billion euros.
Avio's space assets, worth an estimated 200-300 million euros, are expected to be sold separately upon approval by the Italian government which considers them strategic, the sources said.
France's aerospace group Safran (SAF.PA) would be an obvious buyer for the space unit, but such a move would face political opposition, according to Italian bankers involved. However a source close to the deal said Safran was interested in the whole Avio group and not just its space business.
The government is thought to be reluctant to let Avio's space operations fall into foreign hands and could prefer to cede them to state-backed private equity fund FSI.
(Reporting by Massimo Gaia, Elisa Anzolin, Paola Arosio, editing by Silvia Aloisi)