Mitch Joel WARNING... LONG RANT! It takes a lot for me to both get angry and publish about it. Canada’s…
Aircraft maintenance, repair & overhaul
December 27, 2007
Keeping aircraft flying safely is a $43-billion global market. ACTS CEO Chahram Bolouri wants to make his company the leader in the Americas for maintenance, repair and overhaul
ROBERT GIBBENS, Freelance
When ACTS’s CEO Chahram Bolouri looks toward Dorval from his sparse office in St. Laurent’s Technoparc, he’s thinking of a $43-billion global market for aircraft maintenance, repair and overhaul, or MRO, which is growing by four per cent annually.
That’s what it takes to keep thousands of aircraft flying safely, but Bolouri’s real goal is to make ACTS, the old Air Canada Technical Services, the leading independent MRO organization in the Americas. That’s still an $18-billion market – 42 per cent of the world total.
Bolouri, 53, took over the top job at ACTS from retiring Bill Zoeller in February 2006, with a mandate to create a stand-alone MRO company that could be taken public by parent ACE Aviation Holdings Inc.
But times changed swiftly and the initial public offering didn’t lift off. Last June, ACE (which holds 75 per cent of Air Canada) sold ACTS to U.S. buyout giants Kohlberg Kravis Roberts & Co. and Sageview Capital LLC for $723 million. ACE retained a 23-per-cent stake.
ACTS officially began flying solo in October, but Bolouri had already put his stamp on the company. He beefed up senior management and went after new airline customers.
He had to restructure ACTS …. Also he had to integrate the $45-million takeover of Aeroman, the MRO unit of Grupo TACA Holdings Ltd., in El Salvador, late in 2006. TACA is an airline flying mainly in Latin America. Aeroman has a global reputation and services such narrow-body aircraft as the Airbus A320 and Boeing 737.
“In less than two years, we’ve managed to turn a loss-making MRO into a competitive and profitable organization, lifting annual revenue from $700 million to nearly $1 billion, and able to support our debt,” Bolouri said.
… ACTS is watching closely as new airlines proliferate, fleets multiply and MRO organizations spring up in low-cost areas. …
ACTS has an exclusive contract with Air Canada for airframe maintenance in Canada. The Montreal and Vancouver airframe shops continue to focus on wide-body aircraft such as Boeing 757s and 767s and Airbus A330-340s, with Montreal operating seven hangar “lines” and Vancouver two.
The Winnipeg base does narrow-body work only and is booked solid. Aeroman does have a much lower cost base than the Canadian shops, but it dovetails closely with ACTS’s wider business strategy and will focus solely on narrow-body aircraft. It operates four “lines” doing work for JetBlue, U.S. Airways and others. Order books are full for three years and two more “lines” are being added to handle more U.S. airline work. … Montreal is now servicing components from avionics, hydraulics, and electricals to airframe components for two Latin American airlines. It’s our full-service base with its capacity to handle 400 engines a year.
…Buyout specialists usually expect to take the companies they invest in public within three to five years. … ACE is expected to monetize its remaining 23 per cent of ACTS, possibly through a secondary offering, analysts said.
ACE, the holding company, will eventually be wound up. Complete article
Meanwhile, close by in Plattsburgh, Laurentian Aerospace Corporation is developing a state-of-the-art maintenance repair and overhaul (MRO) facility at the Plattsburgh International Airport.
The new maintenance facility will provide heavy maintenance for wide-body aircraft.
The airport has an 11,750 foot long, 200 foot wide runway, utilizing 12 inch thick concrete.
The hangar which Laurentian will construct will have an area of approximately 273,000 square feet. The hangar will have two bays, with each bay capable of servicing all wide-body aircraft, with the exception of the A-380.
The Chairman of Laurentian is Pierre Jeanniot, former Director General of IATA and former President & CEO of Air Canada, while the CEO of Laurentian is Wednesday Night’s Robin Wohnsigl, who was President of Air Canada Technical Services (ACTS) from 1997 to 2003.