Boeing, VSMPO form Russian titanium joint venture

ZHUKOVSKY, Russia, Aug 21 (Reuters) - U.S. aircraft maker Boeing Co (BA.N) on Tuesday announced the formation of a joint venture with Russia's VSMPO-Avisma (VSMO.MM) to produce titanium parts for its 787 Dreamliner jets.

Ural Boeing Manufacturing (UBM) will be owned 50 percent each by Boeing and VSMPO-Avisma, the world's largest titanium producer, and will begin operating in Russia in 2008.

"UBM will machine titanium forgings for use on the Boeing 787 Dreamliner," Boeing said in a statement.

Both companies first announced their intention to form the joint venture in April 2006. They will build an 8,900 square metre plant in Verkhnaya Salda, the town in the Ural mountains where VSMPO-Avisma is headquartered. Boeing did not disclose the value of the venture or the investment required to construct the plant.

Gary Baker, 51, has been appointed chief executive of UBM.

"Through UBM and the joint partnership of Boeing and VSMPO-Avisma, we will expand our capabilities in titanium products and increase our overall efficiency and productivity," Baker, a 27-year Boeing veteran, said in the statement.

VSMPO-Avisma, already a supplier of titanium products to Boeing, Airbus (EAD.PA), Brazil's Embraer (EMBR3.SA) and other aerospace firms, is majority owned by Russian state arms exporter Rosoboronexport.

The forgings produced by UBM will be further processed at Boeing's plant in Portland, Oregon and by other subcontractors.

((Reporting by Guy Faulconbridge, writing by Robin Paxton;Editing by David Cowell; Reuters Messaging: robin.paxton.reuters.com@reuters.net; +7 495 775 1242)) Keywords: BOEING RUSSIA/VENTURE

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