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ST Engineering to invest US$35m in Florida aircraft maintenance, repair and overhaul project
SINGAPORE Technologies Engineering (ST Engineering) is jointly investing in an aircraft maintenance, repair and overhaul (MRO) project in the United States, along with various American government-linked development partners, under a tie-up inked last Saturday and announced on Monday morning.
The Temasek-linked technology, defence and engineering group will put about US$35 million into a 655,000 square foot airframe MRO complex at Pensacola International Airport in Pensacola, Florida, and will develop it over four years in partnership with the City of Pensacola.
The new Pensacola design-to-build project, which has an estimated development cost of US$210 million in all, is next to another ST Engineering MRO facility and joins two other bases in the US that are now being run by the group: in Mobile, Alabama, and San Antonio, Texas.
The rest of the funds for the project will come from city, county, state and federal sources, as well as Triumph Gulf Coast, an organisation that manages most of the funds recovered by state authorities in damages from the Deepwater Horizon oil spill disaster in 2010.
The newly announced project is set to comprise three wide-body aircraft hangars and an office building, and is expected to contribute about 1.5 million labour hours in annual capacity. This will grow the annual capacity of ST Engineering's planned Pensacola Aerospace Campus to 2.1 million labour hours.
ST Engineering's existing 173,500 sq ft MRO facility next door has already redelivered 25 aircraft since it opened in June 2018, the group noted.
ST Engineering said in a statement: "The expansion plan in Pensacola, which aligns with the group's commitment to invest in its core business, would strengthen ST Engineering's aerospace network in the US to better serve its growing customer base in the Americas."
Lim Serh Ghee, president for aerospace at ST Engineering, added: "The attractiveness of this investment is further strengthened by the strong ecosystem and robust aerospace industry, supported by a ready workforce pool in the Florida panhandle region that we can tap on.
"We look forward to working as closely as ever with the mayor's office and relevant local authorities and organisations to realise this expansion plan."
ST Engineering said that the deal is not expected to have any material impact on its consolidated net tangible assets and earnings per share for the financial year.
The counter last traded at S$3.41 on Friday, down by S$0.02, or 0.58 per cent.