Precision Castparts to buy France's Permaswage for $600 mn

Precision Castparts Corp, a US supplier of metal parts for the aerospace, defence and automobile industries, today said that it would buy France's Permaswage SAS for $600 million in order to expand its product range of its Airframe Products division.

The deal comes seven months after Precision Castparts acquired Titanium Metals Corp, a leading maker of alloys used in jet engines, for $2.9 billion and a year after it purchased aircraft parts business of Canada's Héroux-Devtek Inc, for about $295 million.

Founded in 1938 as Deutsch Metal Components, Permaswage designs and manufactures permanent fittings used in fluid conveyance systems for airframe applications, as well as related installation tooling. Its permanent fittings have been designed into virtually every major commercial and military aircraft.

In 2005, the company was acquired by Stirling Square Capital Partners who formed Global Design Technologies by merging a renamed Designed Metal Connections (USA) and Permaswage SA (France) and named it Permaswage.

Bridgepoint Capital, the current owner, acquired Permaswage in 2007.

The company has manufacturing locations in California, France and China, and employs approximately 680 people.

"The acquisition of Permaswage continues our disciplined drive to enhance our value proposition to our airframe customers," said Mark Donegan, chairman and chief executive officer of Precision Castparts Corp.

"The company extends our reach into permanent fittings, building on the foothold in separable fittings we established with the acquisition of Airdrome. Permaswage has secured strong permanent fittings positions on key current and next-generation commercial aircraft platforms, and the long-term opportunities for profitable growth that we can derive from this acquisition are substantial," he added.

The cash acquisition will be immediately accretive to earnings. Subject to regulatory approvals, the transaction is expected to be completed during the second quarter of fiscal 2014, after which its results will be reported as part of the Airframe Products segment.

Portland, Oregon-based Precision Castparts is a diversified manufacturer of complex metal components and products serving the aerospace, power, and general industrial markets.

It is the market leader in manufacturing large, complex structural investment castings, airfoil castings, forged components, and highly engineered, critical fasteners for aerospace applications.

The company is also a leading producer of airfoil castings for the industrial gas turbine, power generation, oil & gas, commercial and defence industry.

Precision Castparts, which has Lockheed, Bombardier and Gulfstream as its clients, has a market cap of $32 billion and annual turnover of $8.4 billion.