| NEW YORK
NEW YORK May 9 Blackstone Group LP hired
former senior Boeing Co executive Jim Albaugh to boost
the firm's private equity activities in the aerospace and
The hiring of Albaugh, who most recently served as chief
executive and president of Boeing Commercial Airplanes, could
help put Blackstone on the map as a major investor in the
sector, which has been led by rival private equity firm Carlyle
Blackstone said in a statement on Thursday that Albaugh, as
a senior adviser to the firm, will also advise other businesses
and clients across Blackstone's platforms.
Albaugh, 62, retired from Boeing in October. In a 37-year
career there, he also headed Boeing's defense and space
businesses before moving to commercial airplanes.
The New York-based alternative asset manager is building its
strength in the industry at a time when defense companies are
cutting capacity in response to budget cuts and sequestration,
and commercial aerospace parts suppliers are trying to keep up
with record production of jets by Boeing and Airbus.
Private equity companies can help the transformation, and
Albaugh's experience in defense, commercial airplanes and space
could help Blackstone identify opportunities in all these
industry sectors, said Tom Captain, vice chairman at Deloitte,
focused on aerospace and defense.
"The fact that a very large private equity company is hiring
an aerospace and defense veteran speaks volumes as to what
opportunities there may be in investing in the aerospace
industry," Captain said.
"Clearly the guys at Carlyle are incredibly astute and
successful. They have lots of experience in the sector," said
Ken Herbert, analyst at Imperial Capital in San Francisco.
"Blackstone wasn't as strong. This puts them in the game."
Among the private equity firms active in the aerospace and
defense sector, Carlyle is seen as a formidable competitor.
It owned Vought Aircraft Industries Inc, which made parts
for the Boeing 787 Dreamliner, and invested in other aerospace
companies that include Aviall Inc, Avio SpA and Wesco Aircraft
Holdings. Its aerospace investment activities have been
spearheaded by Adam Palmer, a former Lehman Brothers investment
banker who has been with Carlyle since 1996.
In 2009, Boeing agreed to buy the Vought facility in South
Carolina where Dreamliner fuselage sections were made. That
facility now houses Boeing's second production line for the 787.