October 3, 2019 / 8:13 PM / 17 days ago

Spirit AeroSystems emerges as front-runner for Bombardier's Belfast, Morocco plants: sources

MONTREAL/SEATTLE (Reuters) - Spirit AeroSystems Holdings Inc (SPR.N) has emerged as the front-runner to acquire Bombardier Inc’s (BBDb.TO) aerostructures facilities in Belfast and Morocco, two sources familiar with the matter told Reuters.

FILE PHOTO: Bombardier's logo is seen on the building of the company's service centre at Biggin Hill, Britain March 5, 2018. REUTERS/Peter Nicholls/File Photo

A deal for the plants would be strategic for U.S. aerospace components maker Spirit, which is diversifying its customer base. But an agreement for the plants has not been concluded and talks could break off, said one of the sources, who discussed the private negotiations on condition of anonymity.

Bombardier said in May it would sell off the two aerostructures operations, including a wing-making facility in Belfast, as the Montreal-based company sheds its commercial aviation businesses to focus on more profitable corporate jets and passenger rail cars businesses.

Reuters could not ascertain a value for the deal.

Bombardier and Spirit both declined to comment.

Spirit, which analysts have speculated as a possible buyer for the plants, has said publicly its acquisition criteria includes diversification away from Boeing Co (BA.N).

Other potential suitors named by analysts and in media reports have included Europe’s Airbus SE (AIR.PA), Spain’s Aernnova and GKN Aerospace.

One of the sources said Airbus is not bidding for Bombardier’s facilities.

An Airbus spokesman declined to comment on speculation but said that Bombardier’s aerostructures and engineering services is a key supplier to the company.

“We of course monitor the situation to ensure the supplies and competitiveness are maintained,” the spokesman said.

Airbus Chief Executive Guillaume Faury said in September the planemaker wants to lower A220 costs from suppliers by 20% over three years.

Aernnova and GKN Aerospace could not be immediately reached for comment.

The Belfast plant, which produces wings for Airbus’s A220 jet, is considered politically sensitive as the largest high-tech manufacturer in Northern Ireland with a workforce of around 3,500. Bombardier is also selling a wing component plant in Morocco.

Spirit is Boeing’s largest supplier, but has plans to grow its business with Airbus with the 2018 announced acquisition of supplier Asco Industries for $650 million.

In May, Spirit, which makes the fuselage, structural engine components and wing parts for Boeing’s 737 MAX, suspended its full-year outlook following the global grounding of the jet in the wake of two deadly crashes involving the model.

But Spirit has continued to produce parts for the MAX at a rate of 52 units per month, even as Boeing cut production of the plane to 42 per month. It cut overtime, froze hiring and other costs to offset impact of MAX grounding, the company has said.

Reporting by Allison Lampert in Montreal and Eric Johnson in Seattle; Additional reporting by Tim Hepher in Paris; Editing by Denny Thomas and Lisa Shumaker

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below