French aircraft engine manufacturer Safran has entered into negotiations to acquire Zodiac Aerospace in a €10bn deal.
The transaction is expected to create a new global aircraft equipment company that would combine the technologies of both Safran and Zodiac Aerospace.
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Safran CEO Philippe Petitcolin said: "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 of aerospace and defence.
“The technological complementarities will ensure that we accelerate domains as strategic as critical systems and the more electrical aircraft, which make up 40% of Zodiac Aerospace's activities."
It will combine Safran's capabilities in landing gear, wheels and brakes, nacelles, power systems, actuation and avionics, as well as Zodiac’s portfolio of seats, cabin interiors, power distribution, lighting, fuel, oxygen and fluid systems.
The combined group will have a presence in more than 60 countries, around 92,000 employees, approximately €21.2bn in adjusted revenues, and €2.7bn in adjusted recurring operating income.
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By GlobalDataThe entity’s new product range is set to reinforce Safran's presence across all key aircraft programmes and limit exposure to aircraft-OEM delivery cycles.
Zodiac Aerospace supervisory board chairman Didier Domange said: "The creation of this new global leader in the aerospace industry is led by a strong industrial rationale and a long-term vision.
“The new group will be ideally positioned to support its clients in their ambitious programmes for the future."
Safran plans to finance the cash portion of the transaction and its special dividend with a combination of cash on hand, including future proceeds from the disposals of Safran Identity & Security.
