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  • The East is For Sale
    Posted by Graham Warwick 3:26 PM on May 23, 2008

    Italy's Alenia Aeronautica and Aero Vodochody of the Czech Republic are two of three bidders for an 81% stake in Romanian aircraft manufacturer Avione Craiova. That's the state-owned manufacturer of the IAR-99 Soim jet trainer.


    blog post photo
    It's a Hawk. No, it's a Soim. Photo: Avione Craiova

    It's interesting to wonder why they might be interested. Okay, Romania has ordered seven C-27Js from Alenia, but why jet trainer manufacturer Aero might be interested in another jet trainer manufacturer is less obvious. Just to complicate things, Aero supplies Alenia with wing boxes for the C-27J.

    This is just the latest sell-off of former Warsaw Pact aircraft manufacturers. Aero, for example, is now owned by private equity group Penta. Poland's PZL Warszawa-Okecie is owned by EADS, PZL-Meilec by Sikorsky and PZL-Rzeszow by Pratt & Whitney Canada. Russia's Ural Mining & Metallurgical Company has just purchased 51% of Aircraft Industries, the Czech manufacturer of the 19-seat L-410/420. 

    Romania's privatisation agency AVAS relaunched the sale of Avione Craiova after a deal to sell the company to local investors fell through last year. AVAS has also revived efforts for sell 65% of helicopter manufacturer IAR Brasov, which were abandoned last year after the government rejected the sole bid from EADS's Eurocopter.

    The attraction of East European companies is usually their experienced workforce but low cost base. Aero, for example, manufactures Sikorsky's S-76, while PZL Swidnik makes a range of helicopter airframes for AgustaWestland. But the deals can be complicated and risky. In 2004, the Czech government had to take back Boeing's 35% stake in Aero after the partnership foundered, ultimately selling the company to private investors.

    Tags: ar99, Romania, Alenia, Aero

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