Triumph will take over Spirit AeroSystem's loss making production of the Gulfstream G650 and G280 wing programs located in Tulsa, Oklaho...
The agreement requires Spirit to make a cash payment of US$ 160 million to Triumph to take over the business. The transaction will result is an estimated loss in the range of $205 million to $235 million to Spirit, but will generate a cash tax benefit of approximately $220 million to $230 million which, if the closing occurs in 2014.
The deal will make Triumph, a major provider of wings to Gulfstream, supplying four of Gulfstream’s five in-production programs (G280, G450, G550 and G650).
Upon the close of the transaction, production will continue out of Spirit’s Tulsa facility and Triumph will look to utilize its manufacturing experience, resources and wing design engineering capabilities as appropriate to supplement the Tulsa operations.
Spirit employees who are currently working on the Gulfstream programs will be offered positions with Triumph.
Spirit entered business jet market following its divestment from Boeing in 2005, as part diversification move to end reliance on the only customer, Boeing.
Triumph expects the program's cash flow to be negative over the first three years and will become positive in the fourth year.
The business is expected to add approximately $250 million to Triumph's annual revenue.
Triumph Group, is headquartered in Berwyn, Pennsylvania and designs, engineers, manufactures, repairs and overhauls aerostructures, aircraft components, accessories, subassemblies and systems.
