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France's Latecoere looks out for targets in aerospace consolidation
September 18, 2017 / 6:41 PM / 3 months ago

France's Latecoere looks out for targets in aerospace consolidation

(Reuters) - French aerospace equipment maker Latecoere (LAEP.PA) is on the look out for acquisitions so it can expand and win bigger contracts from leading aircraft manufacturers, Chief Executive Officer Yannick Assouad said on Monday.

Latecoere, which supplies fuselages and doors to Airbus (AIR.PA) and Boeing (BA.N), expects consolidation to accelerate after Britain’s GKN (GKN.L) acquired Dutch firm Fokker in 2015 and the U.S. firm LMI bought Belgium’s Sonaca.

“We have a certain number of targets we are working on but acquisitions are a little bit like fishing: one has to put a lot of lines into water to try and catch a fish,” Assouad said during the presentation of Latecoere’s half-year results.

    To secure bigger contracts from Airbus and Boeing, Assouad said Latecoere had to demonstrate it had the capacity to generate sufficient cash flow to finance new developments.

    “And that requires a certain size and ... a very large number of players are too small to reach that,” the chief executive said.

    Latecoere, which improved its operating margin in the first six months and confirmed its annual guidance, gained 5 percent in Monday trade.

    Reporting by Cyril Altmeyer; Writing by Michal Aleksandrowicz; Editing by Richard Lough and Edmund Blair

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