PARIS (Reuters) - British defence and aerospace supplier Cobham is on the hunt for more purchases in the aviation services and communications sectors, as it looks to offset the impact of defence budget cuts in the United States and Europe.
The company, whose products include communication equipment for military and commercial aircraft, has been looking to reduce its reliance on the defence sector, which at present provides close to 70 percent of its revenue.
“I want to buy businesses that already grow organically and can grow organically,” Chief Executive Bob Murphy said at the Paris Airshow on Tuesday.
The company said in March it could take on 800 million pounds ($1.26 billion) in debt for acquisitions and last month bought wireless communications firm Axell Wireless for 85 million pounds as part of its shift to the commercial sector.
Aviation services - where Cobham provides training Britain’s helicopter pilots and provides air-freight services for Papua New Guinea - contributed 20 percent to the company’s revenue last year.
Murphy said that Cobham was also keen to buy in the commercial aerospace arena as well but has been dissuaded by the high prices. Commercial aerospace assets have been in demand following the ramp up of several civil aerospace programmes amid falling military sales.
“I love the space, like that we’re participating in that space and would like to do more but for me you really need to find a value for the long haul,” he said.
Reporting by Brenda Goh; editing by Rhys Jones