Emteq buy sees B/E grow footprint in IFEC and cabin power

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Make no mistake about it – B/E Aerospace is broadening its footprint in inflight entertainment and connectivity (IFEC) and cabin management and power in the business aircraft sector.

Hot on the heels of receiving Federal Trade Commission approval to acquire Emteq, B/E Aerospace has signed a definitive agreement to buy the aircraft lighting specialist, and inked a separate definitive pact to acquire Fischer + Entwicklungen, the leading manufacturer of seating products for civilian helicopters.

The total acquisition purchase price for both companies is approximately $470 million. Combined, Emteq and Fischer had revenues of about $150 for the 12 months ended 31 March 2014. The Emteq transaction is expected to close this month, while the Fischer transaction is expected to close around the beginning of the third quarter, subject to regulatory approvals.

In confirming the deals today, B/E Aerospace chairman and CEO Amin Khoury stated, “Demand for comprehensive and integrated solutions for power management, lighting and connectivity within the aircraft cabin is growing, and the acquisition of Emteq will enable us to offer more comprehensive solutions. Customers value the ability to partner with a company that can deliver turn-key solutions.

“The combination of our lighting and power management systems business with Emteq’s highly complementary lighting, cabin management and power systems businesses, as well as their electrical and connectivity expertise, will allow us to expand our product and service offerings in the commercial airliner and business jet markets.”

Earlier this year, B/E Aerospace gave what appeared to be its first public indication that the aircraft interiors behemoth would entertain potential acquisition and/or partnership opportunities in IFEC. B/E Aerospace corporate VP strategy & marketing Paul-Ernest Cheron told Runway Girl Network that connectivity, in particular, was “something very high on the list”.

Though Emteq is widely known for its cabin lighting prowess (serving both commercial and business aviation operators), the company’s portfolio includes a variety of wireless IFEC solutions for business aviation, including ‘Cabin Control by eConnect’, which allows wireless control of cabin systems; ‘Wireless IFE by eConnect’, which wirelessly streams high-definition content to personal electronic devices or cabin monitors; and ‘Router by eConnect’, a high-speed Wi-Fi router that boasts advanced compression, aggregation, and acceleration technology.

According to Emteq, ‘Router by eConnect’ is compatible with Iridium, Inmarsat Swift64, Inmarsat SwiftBroadband, and Ku-band systems. Emteq also offers a family of AC power outlets, and supplies engineering services and STC avionics installation kits, among other products and services.

“This acquisition will allow B/E Aerospace to provide complete aircraft lighting and engineering integration solutions, allowing technology crossover and additional product and service offerings in numerous aircraft platforms. We also expect significant product development, manufacturing and operational synergies,” notes Khoury.

Over the last few years, B/E Aerospace rival Zodiac Aerospace has also engaged in an acquisition spree in the IFEC space, buying engineering services firm Northwest Aerospace Technologies (NAT) and inflight entertainment specialist The IMS Company, which it renamed Zodiac Inflight Innovations (Zii). Later, Zii acquired TriaGnoSys, whose software enables airline passengers to use their mobile phones and Internet during flights, and confirmed it had submitted proposals to airlines to include Ka-band satellite-supported connectivity from ViaSat.

Would B/E Aerospace ever embrace an embedded IFE solution? In 1999, B/E Aerospace famously exited the still somewhat nascent IFE business when the company sold its remaining 49% stake in Sextant In-Flight Systems to joint venture partner Sextant Avionique, then a subsidiary of Thompson CSF, which was later renamed Thales.

But recently the company revealed it has completed a small bolt-on transaction in the business aircraft sector, “which adds not IFE, but IFE interface, lighting control, power management and actuation control capability”.

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