Safran announces merger agreement with Zodiac Aerospace
- by Constance Griffith
- in Money
- — Jan 20, 2017
Aircraft seats supplier Zodiac Aerospace announced on Thursday that has agreed to an offer from fellow French aerospace company Safran SA, with reports placing the deal at €8.5 billion ($9 billion).
"The acquisition of Zodiac Aerospace represents a unique opportunity at this point in Safran's development, just a few months after initiating the refocus of the group on our core activities in aerospace and defense", said Safran CEO Philippe Petitcolin. French President François Hollande welcomed "this handsome industrial transaction which strengthens the French aeronautics industry", the president's office said.
Safran added that it has already identified €200 million of so-called cost synergies, 50 percent of which it estimates it could achieve in the first year and 90 percent in the second year, allowing it to meet its RoCE (return on capital employed) goal in three years.
Safran meanwhile, dominates the supply of engines for short-haul passenger jets, with its long-running partnership with General Electric. Safran E&D had 2015 sales of some €1.27 billion.
It would also establish the world's third largest aerospace group, excluding aircraft manufacturers, with revenues coming from aerospace propulsion and aircraft equipment.
Madame Tussauds Unveils New Trump Wax Figure Ahead Of Inauguration Day
As for intricate details, it took approximately five weeks alone to recreate Trump's iconic hairdo, according to Madame Tussauds . The exhibits are set to open to the public Friday, the day of Trump's inauguration as the 45th president of the United States.
French aircraft engine maker Safran SA is reported to have tabled a friendly 10-billion ($10.6 billion) takeover offer for aerospace equipment and systems maker Zodiac Aerospace.
Airbus said this month there were still some difficulties in cabin supplies for the A350, whose deliveries have been partly held up by problems with toilets supplied by Zodiac.
Under the deal, Safran will launch a cash offer worth 29.47 euros per share, a 26 percent premium to Wednesday's Zodiac closing price of 23.31 euros.
Olivier Zarrouati, chairman of Zodiac's management board said the move will lead to "the creation of a world leader" able to "shape the future of aerospace".
