Alcoa Inc. announced today that it has agreed to acquire the assets of Fairchild Fasteners, a supplier of aerospace fasteners, from The Fairchild Corporation for $657 million in cash.
According to a statement, Fairchild Fasteners will be combined with Huck, Alcoa’s current fastening systems business, to form Alcoa Fastening Systems (AFS).
The new AFS business will have combined revenues of approximately $1 billion. Of that amount, 60% represents sales to aerospace customers, 23% to commercial transportation, and 17% to automotive industries.
It is estimated that the acquisition can yield $50 million before taxes in synergies over three years through increased use of shared services and deployment of the Alcoa Business System.
In addition, $70 million of reductions in working capital is planned through improved productivity.
The transaction is expected to close in the fourth quarter of 2002, subject to the completion of customary regulatory approvals and approval by The Fairchild Corporation shareholders.