EADS Astrium To Bid for Avio Space Business

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LE BOURGET, France — EADS Astrium Space Transportation will enter the bidding for Italy’s Avio, which makes solid-rocket motors and is prime contractor on the Vega small-satellite launcher, as part of a play to consolidate Europe’s rocket-manufacturing sector, the company’s chief executive said June 18.

“We have to restructure European industry for the next generation of launchers,” said Alain Charmeau, whose company is prime contractor for Europe’s heavy-lift Ariane 5 vehicle. “There is a good market for launchers of small satellites, and Europe now uses Indian and Russian vehicles, which are not so easy. We also think we can create many synergies between Vega and Ariane.”

In a press briefing in Le Bourget, France, at the Paris Air Show, Charmeau said there are numerous synergies to be had in the production of Ariane 5 and Vega components, and that sharing information between the two vehicles on elements such as guidance, navigation and control with a view to reducing costs would serve both companies’ interests.

“Why have two separate avionics suites for the two launchers?” Charmeau asked. “What we need in Europe is one single system engineering prime. We have been working with Avio as part of ESA’s [New European Launch Service] program, and our final report will be delivered to ESA in a few weeks.”

The 20-nation European Space Agency (ESA) has asked industry to propose new ways of developing and operating launch vehicles with a view to reducing costs. The 12-month studies are scheduled for submission in July.

General Electric recently purchased the nonspace assets of Avio. The surviving space division builds about 14 percent of the value of a given Ariane 5 rocket and is 70 percent owner of ELV SpA of Italy, the prime contractor for Europe’s new Vega small-satellite launcher, which has successfully completed its first two flights.

The remaining 30 percent of ELV is owned by the Italian Space Agency.

Avio is owned 81 percent by European private-equity firm Cinven, 14 percent by Italy’s Finmeccanica aerospace conglomerate and 5 percent by other investors. Avio’s aviation business was sold to General Electric in December.

Next up is the space division, which industry officials have estimated could fetch a price of around 350 million euros ($460 million). Safran of France, whose Snecma division is a partner with Avio in Ariane 5 solid-rocket production, has also expressed an interest in the company, and other bids are expected by the July deadline.

 

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