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On the Record
Terry Twigger, CEO, Meggitt plc
“We must be 50% bigger than we were at the last Paris Air Show,” says Meggitt boss Terry Twigger. It’s less than a year since he announced the takeover of the design and manufacturing division of the Dunlop Standard Aerospace Group and already the effects of that major acquisition are showing up on Meggitt’s bottom line. “Our turnover in 2003 was $728 million. In 2005 we expect $1,092 million. Dunlop has added about $218/$237 million of that extra £364 million.”
Meggitt remains on the prowl for further acquisitions. Says Twigger, “in terms of making smaller bolt-on acquisitions out of our own cash flow, then if a suitable prospect comes up we’ll take it.”
So where might the ‘smart money’ be looking in his business sector? “We are very interested in sensors. We will continue to build on our engine condition monitoring expertise, to build complete engine condition monitoring packages. Engine accessories — valves, seals, ducts, heat exchangers, oil separators, we are very interested in more complete packages to form subsystems. We would be looking to take on the complete thermal management task for engines, or avionics or the aircraft itself — in the cabin, for example.”
“We still like defense, we like targets and training. There is a list of companies that we have identified (for acquisition) that we come back and look at, from time to time. They would all fit with our existing core capabilities.”
“We are also very interested in general aviation, with the new very lights jets at the top end of that segment. We have significant work content on the Eclipse 500 — and we are discussing our options for other platforms, although I can’t say who. But if you look at the Eclipse in particular, it’s difficult to say that it’s ‘just another aircraft’. It’s on the market for $1.4 million, it’s hitting its targets, it’s over its problems. It looks like an aircraft that will transform the GA market and create a whole new business area.”
Another new area for Meggitt is China where the company has recently opened a facility in Xiamen (moving commercial sensors production there from the U.S. Virgin Islands). Dunlop already had a facility in Singapore and Twigger talks of establishing a “Singapore-China axis, to bring in more sourcing from that region.” Meggitt has plans for China and for Twigger the rationale is clear. “It’s a mix of low manufacturing costs, a local base to develop applications and a large, growing market, “ he says. “We will put more production lines into China as we identify the right ones. I’d be surprised if we didn’t set up a new plant there, or at least expand the one we already have.” —Robert Hewson
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