AAR and Air France Industries KLM Engineering & Maintenance to form joint venture in Asia-Pacific region

Rhea-AI Summary

AAR CORP. (NYSE: AIR) and Air France Industries KLM Engineering & Maintenance (AFI KLM E&M) have signed an agreement to form a joint venture in the Asia-Pacific region. Located in AAR's Chonburi, Thailand facility, the venture will focus on nacelle maintenance, repair, and overhaul services for next-generation aircraft, including on-wing/on-site inspections and parts availability.

This marks their second joint venture, following their 2021 collaboration in the Americas region through Triumph Product Support, which AAR acquired earlier this year. The new partnership aims to combine an independent MRO with a global airline and MRO provider to deliver enhanced service and support for operators. The formation is subject to regulatory approval and will expand their worldwide network for nacelle services.

Positive

• Strategic expansion into the growing Asia-Pacific aviation market
• Leveraging existing facility in Thailand for operational efficiency
• Enhancement of service capabilities through partnership with major airline MRO
• Expansion of nacelle maintenance portfolio and network coverage

Negative

• Regulatory approval pending for joint venture formation
• Significant capital investment likely required for new operations

News Market Reaction

-5.46%

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-5.46% News Effect

On the day this news was published, AIR declined 5.46%, reflecting a notable negative market reaction.

Data tracked by StockTitan Argus on the day of publication.

WOOD DALE, Ill. and PARIS and AMSTELVEEN, Netherlands and CHONBURI, Thailand, Dec. 12, 2024 /PRNewswire/ -- AAR CORP. (NYSE: AIR), a leading provider of aviation services to commercial and government operators, MROs, and OEMs, and Air France Industries KLM Engineering & Maintenance (AFI KLM E&M), a multi-product airline MRO, announced today they signed an agreement to form a joint venture in the Asia-Pacific region to support nacelles of next generation aircraft. This is the second joint venture to be formed by the companies. The first was formed in 2021 by Triumph Product Support, which was acquired by AAR earlier this year, and AFI KLM E&M to serve the Americas region.

"Our joint venture will be positioned with strong capability to meet the needs of the largest fleets in the APAC region"

Located in AAR's Chonburi, Thailand, facility, the new joint venture will perform next generation nacelle maintenance, repair, and overhaul services, including on-wing / on-site inspections, and ensure extensive part availability for their valued customers. Together, AAR and AFI KLM E&M are dedicated to meeting the evolving needs of the aviation industry and maintaining their highly regarded reputations for excellence in MRO services. The combination of an independent MRO with a global airline and MRO will provide unparalleled service and support for operators. The formation of the joint venture is subject to regulatory approval and serves as an addition to the worldwide network for nacelle services.

"This partnership with AAR strengthens both our positions in the Asia-Pacific region. Our expertise, local proximity, and sustainable supply chain will ensure superior MRO services with enhanced efficiency, reliability, and part availability," said Benjamin Moreau, AFI KLM E&M's Senior Vice President of Strategy & Business Development.

"By combining the experiences and innovative approaches of AAR and AFI KLM E&M, we are able to expand our nacelle capabilities portfolio and support an extensive network of operators," said Jim Berberet, AAR's Senior Vice President of Component Services. "Our joint venture will be positioned with strong capability to meet the needs of the largest fleets in the APAC region, and we plan to continue to cover additional engine nacelle types in the future."

About AAR
AAR is a global aerospace and defense aftermarket solutions company with operations in over 20 countries. Headquartered in the Chicago area, AAR supports commercial and government customers through four operating segments: Parts Supply, Repair & Engineering, Integrated Solutions, and Expeditionary Services. Additional information can be found at aarcorp.com.

About AFI KLM E&M
Air France Industries KLM Engineering & Maintenance is a major multi-product MRO (Maintenance, Repair, Overhaul) provider. With a workforce of over 12,800, AFI KLM E&M offers comprehensive technical support for airlines, ranging from engineering and line maintenance to engine overhaul, aero structure, and fan thrust reverser support, as well as the management, repair, and supply of aircraft components, structured around a powerful logistics network. AFI KLM E&M supports almost 3,000 aircraft operated by 200 major international and domestic airlines. www.afiklmem.com

This press release contains certain statements relating to future results, which are forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995, reflecting management's expectations about future conditions, including regulatory approval of the new joint venture and anticipated capabilities, activities and benefits related to the new joint venture. Forward-looking statements may also be identified because they contain words such as ''anticipate,'' ''believe,'' ''continue,'' ''could,'' ''estimate,'' ''expect,'' ''intend,'' ''likely,'' ''may,'' ''might,'' ''plan,'' ''potential,'' ''predict,'' ''project,'' ''seek,'' ''should,'' ''target,'' ''will,'' ''would,'' or similar expressions and the negatives of those terms. These forward-looking statements are based on beliefs of Company management, as well as assumptions and estimates based on information currently available to the Company and are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or those anticipated. For a discussion of these and other risks and uncertainties, refer to "Risk Factors" in our most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q. Should one or more of these risks or uncertainties materialize adversely, or should underlying assumptions or estimates prove incorrect, actual results may vary materially from those described. These events and uncertainties are difficult or impossible to predict accurately and many are beyond the Company's control. The Company assumes no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.

Contact:
Media Team
+1-630-227-5100
Editor@aarcorp.com

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SOURCE AAR CORP.

FAQ

What is the purpose of AAR's (AIR) new joint venture with Air France Industries KLM E&M?

The joint venture aims to provide nacelle maintenance, repair, and overhaul services for next-generation aircraft in the Asia-Pacific region, including on-wing/on-site inspections and parts availability.

Where will AAR's (AIR) new Asia-Pacific joint venture be located?

The joint venture will be located in AAR's facility in Chonburi, Thailand.

How many joint ventures do AAR (AIR) and Air France Industries KLM E&M now have?

This is their second joint venture, following their first collaboration in 2021 in the Americas region through Triumph Product Support.

What services will AAR's (AIR) new Asia-Pacific joint venture provide?

The joint venture will provide next-generation nacelle maintenance, repair, and overhaul services, including on-wing/on-site inspections and parts availability.

When did AAR (AIR) acquire Triumph Product Support?

According to the press release, AAR acquired Triumph Product Support earlier in 2024.