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NEA & GTI Capital Group Investing $27M In Airworks India

29 December, 2010

Private equity firms New Enterprise Associates and GTI Capital Group are investing $27 million (Rs 123 crore) in Airworks India Engineering Pvt. Ltd, a leading provider of aviation services, sources close to the development told VCCircle. This is the second round of funding into the company for an approximate 30% stake, thereby valuing it at around $85 million (Rs 387 crore).

GTI Group had earlier invested into the aviation services provider in 2007 along with Punj Lloyd, a Delhi based engineering and construction company.

Vivek Gaur, CEO, Airworks, declined to comment on the story saying, “We are not in a position to report anything. It is not our policy to respond to such requests.” An email sent to Bala Deshpande, MD, NEA, did not elicit any response at the time of posting this article. GTI Group spokesperson declined to comment on the development too.

Airworks was founded in 1951 by P.S. Menon and the late B.G. Menon. It is currently the leading aviation maintenance services companies in India qualified to maintain over 50 aircraft types for over 100 customers across 12 maintenance locations. It also claims to be India’s only EASA-certified MRO with approvals for ATR42/72, Airbus A320, and Boeing B737. The company has built strong OEM relationships and is also an authorized service centre for Rockwell Collins, Gulfstream, Bombardier, Honeywell, Agusta Westland, Bell Helicopter, and Superjet International.

It recently established a dedicated facility for Honeywell International, the world’s largest maker of airplane controls. It also acquired the UK-based aircraft refinishing company Air Livery UK Plc for an estimated amount of Rs 112.5 crore, making it one of the world’s largest providers of aircraft paint services. Airworks’ facility at Hosur is expected to be the first dedicated aircraft paint facility in Asia.

Currently, Airworks has one hangar in its EASA (European Aviation Safety Agency) certified Hosur facility, where it can undertake ‘C’ level checks for Boeing 737’s entire range and ATR42/72. The company is constructing its second hangar which will be dedicated to aircraft painting and is likely to be completed by the year-end. The aviation service provider is expecting to earn $8 -10 million (Rs 37 crore to Rs 46 crore) of new revenues once the facility takes off.

The monies raised will be utilised in building a second hangar facility, ramping up its customer acquistion activities and MRO facilities. According to a recent report in the Hindu Business Line, Airworks has already tied up $50 million to be invested in the next 5-10 years for the development in its Hosur facility. It also has a joint venture with Scandinavian Avionics – SA Air Works India, which provides turnkey avionics solutions to both commercial and military customers in India.

The Maintenance, Repair and Overhaul (MRO) space has seen some private equity action in the past. In 2009, GE Equity, the subsidiary of General Electric acquired 30% stake in Kerns Aero Products for $2 million. In 2007, Subhkam Ventures invested an undisclosed amount in Trusted Aerospace and Engineering Pvt. Ltd.


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NEA & GTI Capital Group Investing $27M In Airworks India

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