AeroTurbine Inc., a wholly owned subsidiary of International Lease Finance Corporation (ILFC), announced today its intention to enter into a new partnership with Lufthansa Technik AG, the world's largest provider of aircraft-related technical services.
Under the arrangement, which is subject to certain antitrust approvals and other customary closing conditions, AeroTurbine and Lufthansa Technik will enter into a set of commercial agreements covering the supply of AeroTurbine material to Lufthansa Technik, the purchase of maintenance services from Lufthansa Technik, and the consignment of surplus material to AeroTurbine.
In conjunction with the commercial agreements, Lufthansa Technik will also purchase from ILFC an indirect 15% minority interest in AeroTurbine. ILFC will continue to own the remaining interest in AeroTurbine. Lufthansa Technik also can exercise an option to increase its investment to 19.9%, if certain performance targets are met under the commercial agreements.
This new partnership builds on the companies’ already strong business relationship, and underscores Lufthansa Technik’s interest in developing a strategic alignment with ILFC, the world’s largest independent aircraft leasing company.
Effective immediately upon closing, the companies will begin to take advantage of the expanded reciprocal business opportunities in the aircraft material maintenance, repair and overhaul market across all business lines.
“We could not be happier about our new partnership with Lufthansa Technik,” said AeroTurbine President and Chief Executive Officer Michael King. “Both companies hold leadership positions in their sectors of the aftermarket, and this alignment will serve to make us both even stronger.”
“We are very excited about our new relationship with AeroTurbine and ILFC,” added August Wilhelm Henningsen, Chief Executive Officer of Lufthansa Technik. “We believe they have a unique value proposition with products and services that are supporting our cost reduction and growth strategy. This agreement combines one of the largest aircraft portfolios, with a world class supply chain organization, to provide serviceable material to the Lufthansa Technik family of companies.”
“The agreement is the logical extension of the companies’ established market cooperation,” said ILFC Chief Executive Officer Henri Courpron. “This new partnership is a first step in developing a broader relationship between Lufthansa Technik and ILFC, which will leverage our core products and processes to generate a significant value for our businesses, and will further advance ILFC’s strategy to provide complete aircraft lifecycle solutions to its customers.”