Aeroflot – Russian Airlines will establish a joint venture intended for providing services in the area of aircraft maintenance, repair and overhaul. According to a decision taken by the Aeroflot’s Board of Directors, Russian Technologies State Corporation and SR Technics (the leading independent MRO provider on the global market with main production capacities in Europe) will be the Aeroflot’s partners, the carrier’s press-service reports.
The Board of Directors approved the top-priority strategic areas of development of Aeroflot’s technical division in September 2012, including possible establishment of the joint venture with the world’s leading MRO provider. Aeroflot and Bainand Company have considered the possibilities of cooperation with 12 world’s leading MRO providers. The companies have presented their own vision of development of aero-technical base in Russia and plan of reduction of Aeroflot Group’s costs on MRO services. The SR Technics’ proposal was chosen as the best one by the amount of investments in RF (~$100 million until 2020) and by the amount of potential benefits, the airline noted.
It is planned to establish two joint ventures – for aircraft maintenance and repair operations and components maintenance and repair operations in order to ensure efficient management, decrease the operating risks and ensure the successful implementation of the project.
"The joint venture for aircraft MRO will be established by the partners on parity basis (each partner will own about 33% of the JV shares). At that the foreign partner will control the enterprise’s activities and be responsible for achieving goals in the area of efficiency in order to ensure the successful technology transfer. The joint venture for components maintenance and repair operations will be responsible for provision of spare parts pool and repair of components. The major contribution to development of this business will be provided by the foreign partner, which will own the majority stake (50%+2 shares - SR Technics, 25% - 1 share – Aeroflot and Russian Technologies)", - said in the airline’s statement.
The joint venture will help increase the efficiency and competitive ability of MRO in Russia. This is especially important in the network of further consolidation of Aeroflot Group and expansion of its fleet, the carrier noted. The establishment of JV allows using the world’s best practices and expertise of foreign MRO providers, decreasing costs and increasing profit. The revenues of the JV over the next 5 years are assessed at $800 million.