SIA Engineering Company (SIAEC) and NYSE-listed Eaton have signed an agreement to form a component maintenance, repair and overhaul joint venture (JV) on July 11.
SIAEC will hold a 49% stake in the JV while Eaton will hold the remaining 51%.
The JV, which has an initial issued and paid-up share capital of US$16 million ($21.5 million), will inspect, test, repair, maintain, modify and overhaul Eaton-manufactured aircraft components installed on airframe and engine fuel systems and hydraulics systems.
It will also build presence and service capacity for Eaton and SIAEC’s customers in the Asia Pacific region, according to the joint statement by SIAEC and Eaton.
The agreement and services to be provided are subject to the receipt of required regulatory approvals.
“The relationship with Eaton in Malaysia is strategic for SIAEC as we have been growing component capabilities and increasing the competitiveness of our component power-by-the-hour product offering. This JV will be an important platform to build capabilities on new-generation aircraft and will complement our existing portfolio of engine and component JVs with other leading original equipment manufacturers,” says Ng Chin Hwee, SIAEC’s CEO.
“This new venture will combine SIAEC’s experience and well-respected position in the region with Eaton’s global reach and existing customer base,” says Nanda Kumar, president, aerospace group, Eaton. “We look forward to building our regional presence to serve customers throughout the product lifecycle in this growing market.”
The transaction is not expected to have a material impact on the net tangible assets per share or the earnings per share of the SIAEC group for the FY2023/2024 ending March 31, 2024.
Shares in SIAEC closed at $2.46 on July 10.
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