GE's widely expected $4.3B deal for Avio has been announced. The following excerpt shows that the deal has an element of vertical integration, as well as the intent to leverage Avio technologies into markets other than aviation.
G.E. and Avio have deep ties. Avio has been supplying components to the American conglomerate since 1984, and more than half of last year’s revenues in the aviation sector came from selling engine components to G.E.
Now, G.E. hopes to tap Avio’s expertise for other industries. The conglomerate said it planned to create “additional opportunities to offer Avio’s products and services beyond the aviation industry” and that it would “pursue new opportunities for Avio in power-generation, oil and marine products.”
“This acquisition is a great strategic fit with our existing portfolio,” David Joyce, president and chief executive of GE Aviation, a G.E. unit, said in a statement. “Avio has technologies, capabilities and outstanding engineers to help grow our business.”