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Thursday, December 26, 2013

Rockwell Collins Acquires ARINC for $1.4 Billion

Woodrow Bellamy III 

Rockwell Collins has completed its $1.4 billion acquisition of ARINC, the Cedar Rapids, Iowa-based aviation and defense electronics manufacturer said Monday Dec. 23. 
 
Annapolis, Md.-based ARINC, provider of aviation information management services, was acquired from asset management firm the Carlyle Group.
Rockwell Collins originally announced the purchase as an agreement in August 2013, shortly after Kelly Ortberg took over as chief executive. 
 
With the purchase, the company is looking to expand its aviation electronics business more into the commercial segment, with ARINC's ground-based navigational networks, and increase its in-flight entertainment offerings. During a conference call in August, Ortberg  said the purchase would allow the company to "shift the balance in commercial," by acquiring ARINC's computer networks which manage data for pilots and airports, but also allows them to expand their traditional business opportunities outside of the cockpit. 
 
"With this move we take a major leap forward to realizing our vision of providing a richer set of seamless information management 
solutions that encompass the aircraft and ground-based systems," Ortberg said Monday.
 
ARINC currently provides information management support for more than 15,000 aircraft across 300 airlines and 150 airports. 
 
Further expansion into the commercial aviation sector will also allow Rockwell Collins to offset the reduction in defense spending by the U.S. and other nations.  In October, the company reported a 4 percent increase in commercial systems sales for its fiscal year 2013 earnings which was offset by an 8 percent reduction in sales of government systems.
 
John Belcher, chief executive for ARINC said the aviation information management company is looking forward to joining "a company that shares our focus on providing trusted solutions."
 
Since the sale agreement was first announced in August, ARINC made several significant aviation industry announcements including beginning work as part of the Harris Corp. team that was awarded the FAA's  seven-year $150 million Data Communications Network Services (DCNS) portion of the Data Communications Integrated Services (DCIS) program in August. Under that contract ARINC will provide data communications network services helping the FAA integrate its end-to-end data system. 
 
At NBAA 2013 in October, ARINC also signed an agreement with Honeywell to develop applications and services for Inmarsat's GX Aviation Ka-band in-flight connectivity solution for business aircraft.
 
"The acquisition represents an exciting new growth platform for Rockwell Collins and shifts the balance of the company toward the expanding commercial aviation sector."

 

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