GKN to Acquire Fokker in Blockbuster Deal

By Ray Jaworowski, Senior Aerospace Analyst, Forecast International.

GKN has agreed to acquire Fokker Technologies Group for EUR706 million ($780 million) from the London-based private equity firm Arle Capital Partners.  The blockbuster deal would bring together two of the world’s leading aerospace technology companies.  Both GKN and Fokker are major Tier 1 suppliers to platform manufacturers in the military, commercial, and business aviation sectors of the global aerospace industry.  The deal includes a EUR500 million cash consideration as well as the assumption of liabilities amounting to EUR206 million.

Headquartered in the Netherlands, Fokker has nearly 5,000 employees across its operations in Europe, North America, and Asia.  In 2014, the company generated revenues of EUR758 million ($836 million) and had a margin of approximately 7 percent.  Fokker has four principal business units:  Fokker Aerostructures, Fokker Elmo, Fokker Landing Gear, and Fokker Services.

Fokker Aerostructures produces aircraft structural components, such as fuselage panels, tail sections, and wing components.  Fokker Elmo specializes in electrical wiring harnesses and electrical distribution systems for fixed-wing and rotary-wing aircraft.  Fokker Landing Gear engages in the design, production, and repair of landing gear, and also produces a variety of hydromechanical assemblies such as actuators and transmissions.  Fokker Services provides maintenance, modification, and logistic services to aircraft operators.

GKN’s plans call for Fokker, once the acquisition is complete, to become a new operating unit within the firm’s GKN Aerospace division.  Fokker’s headquarters is to remain in the Netherlands.  Completion of the acquisition is expected to occur in the fourth quarter of 2015, following consultation with trade unions and various regulatory clearances.

Headquartered in the U.K., GKN has more than 50,000 employees spread out among its aerospace, automotive, and industrial business units.  The company has manufacturing facilities in more than 30 countries.  The GKN Aerospace unit specializes in airframe and engine subassemblies, engine nacelles, transparencies, and ice protection systems, among other products, and had sales in 2014 of EUR3.1 billion ($3.4 billion).

The acquisition of Fokker will strengthen GKN’s aerospace manufacturing footprint, and expand GKN’s content on such key aircraft programs as the A350 commercial airliner and the F-35 Joint Strike Fighter.  The product lines of the two companies fit well together, promising considerable synergies in such areas as aerostructures manufacturing and wiring systems production.  Plus, the incorporation of the Fokker Services business unit will expand GKN’s presence in the increasingly important MRO market for civil and military aircraft.

The deal will also result in GKN assuming Fokker’s 5.5 percent share in the NH Industries consortium that builds the NH90 military multirole helicopter.  GKN will also inherit the type certificates for the out-of-production Fokker 50 and Fokker 60 turboprop airliners and Fokker 70 and Fokker 100 regional jets.

Fokker has a long history in aviation, dating back to the early days of the industry.  The company was founded in 1912.

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