Cinven's Avio to sell aviation business to GE
Private equity firm Cinven’s investment subsidiary, BCV Investments, is to sell the aviation business of portfolio company Avio, which designs, manufactures and services components for commercial and military jet engines, to GE for a total consideration of EUR3.3bn.
Avio will retain full control of its space unit and will remain owned by BCV. Cinven and Finmeccanica own BCV.
Headquartered in Turin, Italy, Avio is a global business which operates in four continents and employs about 5,300 people. In 2011, the group generated revenues of over EUR2bn (up 15.6 per cent on the prior year) and EBITDA of EUR383m (up 13.3 per cent) with investment in R&D and capital expenditure of approximately EUR170m.
Cinven’s BCV acquired Avio in December 2006 for an enterprise value of EUR2.57bn. Avio has demonstrated consistently strong financial performance with revenues increasing by 66 per cent and EBITDA by over 50 per cent under BCV’s ownership.
Roberto Italia, a partner at Cinven, says: “Avio’s strong performance, and the returns generated for our Fund, underlines how Cinven can successfully grow European-based businesses even during periods of economic and political uncertainty. Our investment in BCV and Avio demonstrates clearly significant improvements to the group’s operations, manufacturing processes and competitive positioning, working closely with the management team and through substantial investments in technologies and people. We increased the workforce, extended the Group’s global reach through acquisitions and organic growth. In particular, our Asian portfolio team was instrumental in setting up two JVs in China to help internationalise both Avio’s revenues and cost base.”
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