Defense-based businesses with aerospace capabilities will start looking for potential merger and acquisition (M&A) opportunities for the commercial side of the business, a new report on industry M&A activity predicts. Continued growth in commercial aviation and contraction in defense budgets are expected to drive the trend, says Scott Thompson, U.S. aerospace and defense leader for PricewaterhouseCoopers (PwC), which just released its fourth-quarter and full-year 2012 M&A report for the aerospace and defense industries.
BENGALURU — Indian state-run defense company Bharat Electronics Ltd. (BEL) and Elop Ltd., a subsidiary of Israel’s Elbit Systems, have entered into a joint venture agreement to produce a surveillance system for naval helicopters. The two sides signed a memorandum of understanding (MoU) at the Aero India show in the southern city of Bengaluru for combined production of the Compact Multi Purpose Advance Stabilization System (Compass).
The Senate Armed Services Committee will meet Feb. 12 at 2:30 p.m. to discuss what has become an extraordinarily controversial nomination of former Sen. Chuck Hagel (R-Neb.) for defense secretary. Committee Chairman Sen. Carl Levin (D-Mich.) intends to call for a panel vote on the nomination after the discussion.
Recent program shifts for the Joint Light Tactical Vehicle (JLTV) could raise congressional concerns about foreign interest—or the lack of it—in the effort, according to the Congressional Research Service (CRS). The JLTV is being developed by the U.S. Army and Marine Corps as a successor to the stalwart high-mobility, multi-wheeled vehicle, or Humvee, that has been a staple for the services since 1985.
BENGALURU — Sikorsky has already pitched for the Indian navy’s initial requirement for 16 helicopters, but is not discussing publicly which rotorcraft it will propose for the service’s much larger follow-on program for 123 naval multi-role helicopters (NMRH).
U.S. administration officials are preparing to endorse a report that calls for revisions to the nation’s nuclear strategy and discusses the possibility of a one-third reduction to the arsenal, according to the Center for Public Integrity. The document does not call for immediate changes to the nuclear force; rather officials are seeking to negotiate further reductions to nuclear weapons with Russia. It also notes that President Barack Obama may preview the issue during his Feb. 12 State of the Union Address.
THALES LEADERS: European defense systems company Thales has made sweeping changes to its management and revised its organizational structure. According to a Feb. 8 announcement, the company’s internal organization has been adjusted to reflect six key areas. Alex Cresswell has become executive vice president of Land Defense and Air Operations; Marc Darmon takes on the role of executive vice president for Defense and Security C4I Systems; and Jean-Pierre Forestier will run Transportation Systems.
The chairman of the Senate Armed Services Committee is defending former Sen. Chuck Hagel’s (R-Neb.) right to decline to respond to demands for financial disclosures, saying they go “far beyond the financial disclosure required of previous secretaries of defense.” Sen. Carl Levin (D-Mich.) had hoped to vote last week on Hagel’s nomination to lead the Pentagon, but Levin pushed off the vote to provide time to respond a request for information submitted by Republicans.
BENGALURU — The first upgraded Dassault Mirage 2000H for the Indian air force will be delivered in August or September 2014, Thales India Managing Director Eric Lenseige told Aviation Week Feb. 8 at Aero India. “We’ve met every single milestone of the upgrade program and are on track,” Lenseige says. Two Indian air force Mirage 2000Hs are already being retrofitted in France, and the rest of the fleet will be retrofitted by state-owned Hindustan Aeronautics Limited (HAL). Kits are being developed so HAL can do the upgrades, he adds.
Aerospace defense companies will start expanding into the commercial sector as the effects of military spending cuts and the continued growth of civil aviation prompt a series of mergers and acquisitions (M&A), says Scott Thompson, U.S. aerospace and defense leader for PricewaterhouseCoopers (PwC), which just released its 2012 M&A report for the aerospace and defense industries.
Production ramp-ups amid a transition into new products, particularly the CFM Leap single-aisle engine series and GE90 successor for Boeing's proposed 777X, are behind the late 2012 surge of acquisitions and joint ventures by GE Aviation, including the $4.3 billion purchase of Italian gearbox, turbine and transmission specialist Avio.
The Northrop Grumman/Bell Helicopter Fire-X unmanned helicopter has completed a 250-flight envelope-expansion program at Yuma Proving Ground, Ariz., in preparation for the transfer of testing to the U.S. Navy's MQ-8C Fire Scout endurance upgrade program.
Military intelligence confronts a potential adversary that is secretive and authoritarian, but not for the first time. The media have changed, but like the Soviet Union, China releases what it wants to release. Every large-scale model at the upcoming Idex defense show in Abu Dhabi, every glossy data sheet handed out by a smiling booth attendant (in 2011 at least, the Chinese industry had not switched to memory sticks, because most people aren't that stupid) and the images on the Internet are there for a reason. Promoting exports?
For months, Pentagon officials have described the impact of across-the-board budget cuts with gruesome metaphors. The March 1 deadline for those reductions to take effect is now close enough that the military is beginning to drizzle out some long-awaited specifics. In the past two weeks, each of the services has begun to explain some near-term actions and the longer-term impact to weapons systems and deployment schedules.
If former Sen. Chuck Hagel (R-Neb.) emerges from an extremely contentious confirmation hearing as the next U.S. defense secretary, he may enter the Pentagon weakened at a time when the military's top civilian needs cooperation more than ever. The Pentagon, which scaled back its fiscal expectations dramatically in early 2012, is facing the prospect of $500 billion in across-the-board budget reductions. It is in the midst of drawing down the war in Afghanistan, guarding against continued tension in the Middle East and pivoting forces to the Pacific.
The woman in charge of the National Transportation Safety Board is now among the top contenders to replace Transportation Secretary Ray LaHood. If Deborah Hersman is nominated and confirmed, she will have to temper her approach to ferreting out problems in the transportation system to align with the confines of a limited budget.
BENGALURU — BAE Systems is adamant that Boeing’s anti-ship missile, the Harpoon, can be part of the Eurofighter Typhoon’s weapons arsenal. “We are aware of that issue and the Typhoon can carry a Harpoon if a customer wants to integrate it. We have proposed, however, some novel alternatives other than the Harpoon,” Guy Griffiths, the group managing director of international business at BAE Systems, told Aviation Week Feb. 8 at Aero India.
LONDON — Helicopter MRO organization Heli-One has secured its first contract with the U.K. defense ministry — a deal to support the engines for the Royal Air Force’s Westland Puma Mk. 2 transport helicopters. The company, a subsidiary of helicopter operator CHC, signed the deal on Feb. 7 to provide logistic support for the Turbomeca Makila 1A1 engines fitted to the newly upgraded aircraft over the next 13 years. The deal is understood to be worth $80 million.
