AIRSHOW-Pratt could make engine, energy acquisitions
By Karen Jacobs
PARIS, June 14 (Reuters) - Aircraft engine maker Pratt & Whitney could make acquisitions in its core engine business and energy sector as it looks to grow, the company's president said on Sunday.
The United Technologies (UTX.N) unit has the cash and commitment to take on acquisitions, Pratt & Whitney President Dave Hess said in an interview ahead of the Paris Air Show.
"Within Pratt, certainly we'd look at things that would relate to the core (engine) business," Hess said.
Although there are not a lot of very large or what would be considered top-tier acquisition targets currently, "things could happen," he added.
He said United Technologies has increased interest in energy, as it has a gas turbine business and produces rocket engines that use liquid propellants with its Rocketdyne business.
"We see these ... as potentially fast-growing businesses and it's possible we could see acquisitions in that space," Hess added.
He also said his company was looking to expand in segments such as renewable and alternate energy.
There are more available acquisition candidates in the energy space, "so there's more opportunity," Hess said.
Hess said Pratt & Whitney, which gets as much as 40 percent of its business from military and space and the majority from commercial aerospace, had seen commercial spare orders stabilize, albeit at low levels, and added that air traffic and cargo traffic also seem to have stabilized.
He said it was hard to tell what effect recent announcements of capacity cuts by air carriers including Delta Air Lines Inc [DAL.N] could have on aftermarket sales.
He also said rising oil prices could trigger demand for more fuel-efficient aircraft.
"There was pressure to move forward with new (fuel-efficient) platforms that diminished with oil prices dropping last year," Hess said. "But as they increase again and with some of the challenges airlines are facing, there could be renewed pressure to develop more fuel-efficient aircraft."
(Additional reporting by Andrea Shalal-Esa; Editing Bernard Orr)
