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Onex/Spirit Acquires BAE's Aerostructures Group

Wed Feb 01, 2006 4:16 am

You may know that Spirit is the company formed from Boeing's civil group at Wichita (they retained the military group.) It also owns a couple of North American Aviation plants in the area. This means that Airbus is now a major customer (say 33% of its business?), though probably still not quite to the same extent that Boeing is.

http://www.ccnmatthews.com/news/rele...alse&showText=all&actionFor=578003

It's a press release, so I can post it here in its entirety:
JANUARY 31, 2006 - 09:45 ET

Onex' Spirit AeroSystems To Acquire BAE Systems Aerostructures

TORONTO, ONTARIO--(CCNMatthews - Jan. 31, 2006) - All amounts in Canadian dollars unless otherwise stated

Onex Corporation (TSX:OCX.SV) announced today that its subsidiary, Spirit AeroSystems, Inc., has agreed to acquire the Aerostructures business unit of BAE Systems, with operations in Prestwick, Scotland and Samlesbury, England. The $162 million acquisition will be financed entirely by Spirit with no additional equity contribution by Onex.

Airbus is the largest customer of BAE Systems' aerostructures business, with more than 80% of revenue earned from the production of wing and other structural components for Airbus. "Spirit sees this as an opportunity to diversify our revenue base and accelerate our growth as a world leader in aerostructures and systems manufacturing," said Spirit Executive Vice President and Chief Operating Officer Ron Brunton in a statement to employees.

The Aerostructures unit, which will be known as Spirit AeroSystems (Europe) Ltd., produces structural components, chiefly on wings, similar to those produced in Spirit's business unit in Tulsa, Oklahoma, but on different airplane programs. More than 80 percent of the unit's revenue is earned on Airbus airplanes, including the A320 family, the A330 and the A340. Approximately 15 percent is earned on the Boeing 767 and 777, with the remaining 5 percent being earned on the Raytheon Hawker 800XP. BAE Systems Aerostructures had revenues of approximately $419 million in 2005 and employs more than 800 people in the United Kingdom.

"We are pleased with this significant step in the expansion of Spirit's business," said Nigel Wright, an Onex managing director. "The acquisition will enhance Spirit's manufacturing operations, add important new customers, and further Spirit's leadership in the global industry."

Spirit will continue to focus on winning new work in both its U.S. and European operations. Spirit expects to complete the transaction in the first half of 2006. Completion is subject to certain conditions, including the receipt of required regulatory approvals.

Spirit AeroSystems is the world's largest independent supplier of structures for commercial aircraft. Formed by Onex in June 2005, Spirit continues its work on designing and building part of every Boeing commercial aircraft currently in production, except the 717. Spirit also designs and builds aircraft production tooling, has composite capabilities, and provides spares and aftermarket support to airlines.

Onex is a diversified company with annual consolidated revenues of approximately $16 billion and consolidated assets of approximately $15 billion. Onex is one of Canada's largest companies with global operations in service, manufacturing and technology industries. Its operating companies include Celestica Inc., Spirit AeroSystems, Inc., Emergency Medical Services Corporation, Skilled Healthcare Group, Inc., ClientLogic Corporation, Cineplex Entertainment Limited Partnership, J.L. French Automotive Castings, Inc., Res-Care, Inc., Cosmetic Essence, Inc., Center for Diagnostic Imaging, Inc. and Radian Communication Services Corporation. Onex shares trade on the Toronto Stock Exchange under the stock symbol OCX.SV.

This news release may contain forward-looking statements that are based on management's current expectations and are subject to known and unknown uncertainties and risks, which could cause actual results to differ materially from those contemplated or implied by such forward-looking statements. Onex is under no obligation to update any forward-looking statements contained herein should material facts change due to new information, future events, or otherwise.
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