[Avionics Today March 17, 2014] Air France KLM has reached an agreement to acquire Barfield, the Miami, Fla.-based aircraft Maintenance Repair and Overhaul (MRO) subsidiary of French aviation services company Sabena Technics.
Terms of the agreement were not disclosed. The acquisition will strengthen the presence of Air France KLM in the world's largest aviation market at a time when demand for aircraft maintenance is increasing and airlines continue to search for ways to reduce operating costs with MRO companies that can offer a wide range of services.
"This acquisition supplements and strengthens our presence on the world's biggest aviation market — a strategic region due to its dynamism and potential for growth," said Franck Terner, executive vice president of Air France KLM Engineering and Maintenance.
Terner said the acquisition also helps his company with a regional advantage, as it will join its other wholly owned aircraft maintenance company, Aero Maintenance Group (AMG), which also has locations in Miami, Fla., and Atlanta, Ga., where commercial and regional aircraft flying in North America, Latin America and the Caribbean receive maintenance.
After losing nearly $4.4 billion over the last two years, Air France KLM also needs the acquisition to help improve revenue from operations outside of its core airline business.
The purchase of Barfield also helps Air France against its biggest competitor, Lufthansa Technik. Although foreign airlines have continued to modernize their fleets with large aircraft purchases in recent years, the North American MRO market remains the world's largest, valued at $23.5 billion with a total of 37,000 total civil aircraft, according to the Aeronautical Repair Station Association's (ARSA) 2013 global MRO market economic assessment.
The next two largest markets are Europe, with 16,000, and the Asia Pacific region, which boasts nearly 11,000 aircraft.
Currently, Air France KLM Engineering and Maintenance (Air France KLM E&M) is the world's second-largest provider of aircraft maintenance behind Lufthansa Technik. Air France KLM expects to close the acquisition by midyear.