StandardAero’s business is reshaping with the company's recent acquisition of Vector Aerospace, a move that created a combined organization that produces $3 billion annual revenues and fields a work force of 6,000 employees across 42 locations worldwide, including Singapore. At the same time though, StandardAero (Stand T130) is shedding other operations; it recently closed Associated Air Center, which had been a pioneer in VIP airliner completions, and plans to close its Los Angeles International Airport (LAX) business aircraft and engine MRO facility in California.
StandardAero acquired MRO specialist Vector Aerospace from Airbus in early November. Terms of that deal were not disclosed, but Airbus, formerly EADS, had acquired Vector in 2011 for $625 million.
The acquisition brought to StandardAero an entity that generated $700 million in revenues in 2016 and employed 2,200 workers in 22 locations across Canada, the U.S., the UK, France, Kenya, South Africa, Australia, and Singapore.
“Our combined organizations are better positioned to provide the industry with more global services, expanded MRO capabilities, and operational benefits to deliver faster, higher quality solutions to our combined customers worldwide,” said StandardAero CEO Russell Ford.
This acquisition expands StandardAero’s capabilities on Pratt & Whitney Canada PT6 and PW100 turboprop engines and significantly extends its reach in the civilian and military helicopter-engine MRO market, including on the M250, PT6T, Arriel 1 and 2, T58/CT58, and T700/CT7 engines, Ford said. “Vector also brings along new helicopter airframe and components services/support aligned with major OEMs like Boeing, Sikorsky, Airbus Helicopters, and Bell Helicopter.”
This was the second major StandardAero purchase since March, when it announced plans to acquire PAS Technologies, a support services company for the oil-and-gas sector, industrial-gas-turbine, and aerospace markets. While StandardAero is substantially boosting its MRO and support capabilities, the company also is shrinking in the completions arena with the decision to shutter its VIP completions specialist Associated Air Center at the end of 2017, just shy of its 70th anniversary. StandardAero said current and future volumes of work aren’t sufficient to support the costs necessary to run the facility. StandardAero made “multiple attempts to sell the business” before coming to the decision to shutter it altogether, the company said.
“After a thorough analysis, StandardAero has concluded that the business case for continuing to operate AAC is no longer an economically viable option for the company and its investors,” the company said. “The limited pipeline for new business opportunities, excess industry capacity, and slowing demands in the VVIP aircraft marketplace have all contributed to this decision.” The move, StandardAero added, is in line with its near-term growth plans to expand the group’s core engine MRO capabilities.
StandardAero further is closing its business aviation repair station at LAX by the end of March. The company will maintain mobile aircraft service capabilities in southern California.
The decision to close the LAX facility came after a consultation with the company’s owners, investors, and board of directors, the company said, attributing the move to the “unexpected reduction in the number of worldwide [Honeywell] TFE731 engine events and the associated revenue and volume declines that have accompanied this trend, along with multiple unsuccessful attempts to secure a long-term lease for the LAX facility.”
Other factors included the decrease in demand for scheduled airframe inspection work at the airport and operators reaching out to more convenient business airports in the region.