Strengthened market presence in North America and Europe
In acquiring an interest in the U.S. firm of Hawker Pacific Aerospace (the “Company”), specialists in the servicing of landing gears, Lufthansa Technik AG (LHT) is strengthening its worldwide presence in this overhaul business.
Hawker Pacific Aerospace, with nearly 500 employees, is based in Sun Valley, California, and has additional facilities in London and Amsterdam.
The Company has captured a 20-percent share of the global market for the overhaul of large commercial jet landing gears, and prior to the transaction was the second-largest provider of such services in the world. Hawker Pacific Aerospace also provides repair and overhaul services for rotary-wing aircraft, hydromechanical components, flap tracks and carriages, wheels and braking systems, integrated drive generators and constant-speed drives.
The transaction was effected through the purchase of approximately 40 percent of Hawker`s outstanding common stock from shareholders associated with Unique Investment Corporation. In addition, LHT has purchased convertible preferred stock from another private investor group and, in exchange for a U.S. $ 9.3 million investment in the Company, has received warrants which, if approved by the Company`s shareholders, may increase LHT`s interest to approximately 60 percent of the Company`s common stock.
As a result of this transaction, LHT is significantly expanding its own worldwide service network of Centers of Excellence. In addition, the Company`s base of over 600 customers further enhances LHT`s growth potential.
Supplementing the activities of Lufthansa Technik Component Services in Dallas, LHT`s interest in the Company will greatly strengthen LHT`s market presence in North America.
With its 180 employees, the ultramodern Hawker Pacific Aerospace facility in London currently services landing gears of all Boeing aircraft types and will soon also provide services for Airbus and former Douglas aircraft.
The Lufthansa Technik landing gear division in Hamburg has a staff of 150 and is the world`s largest shop of its kind associated with an airline. It services 200 landing-gear legs annually for airlines from all over the world, mostly those of Airbus jetliners. LHT`s new interest in Hawker Pacific will have no influence on the workload in Hamburg.
“The combination of LHT`s existing landing gear business with the Company`s current number-two market position now makes LHT one of the world`s foremost providers of landing gear overhaul services,” says Wolfgang Mayrhuber, Chairman of LHT`s Executive Board. He has been appointed as the new Chairman of Hawker`s Board of Directors. Joining Mayrhuber on the Board are Dr. Gerald Gallus, LHT Executive Board Member for Finance, and James C. Stoecker, LHT`s General Manager for Business Development in North America.
Dave Lokken, President and Chief Executive Officer of Hawker Pacific Aerospace, added: “This transaction serves the strategic plans of both companies extremely well. We will be able to assist LHT in increasing its market presence in the United States and in providing several additional facilities to service their customers world-wide. LHT will provide Hawker with strong financial backing that will enable it to compete more effectively, strengthen its capital structure, and resolve its senior lending relationship.”
Hawker Pacific Aerospace reported 1999 revenue of U.S. $ 82 million. The Company is growing rapidly, having experienced a 24 percent growth rate in sales over the last five years. The Company is publicly traded on the NASDAQ National Market® under the symbol HPAC.