Hong Kong Aircraft Engineering Company (Haeco) has agreed to buy Timco, a US-based provider of aircraft maintenance and repair services, for $388.8 million.
The acquisition from hedge fund Owl Creek Asset Management is the second-largest US deal by a Hong Kong-listed company since 2011, after Fosun earlier this week announced the $725 million purchase of Chase Manhattan Plaza from JP Morgan.
Timco, headquartered in Greensboro, North Carolina, is one of the world's biggest independent aircraft maintenance, repair and overhaul (MRO) companies in the world. Its acquisition will give Haeco a presence in the US, turning it into the world's second-largest independent MRO company, according to a source.
Haeco is 75%-owned by Swire Pacific, a Hong Kong holding company with major aviation interests. About 40% of its revenues come from Cathay Airways and Dragonair.
Swire Pacific has not been active on the M&A front in the past couple of years but in 2011 sold major Hong Kong shopping mall Festival Walk to Temasek’s Mapletree. In 2006 it bought Dragonair and in 2004 it acquired a 10% stake in Air China, which it subsequently raised to 20%.
Haeco's acquisition of Timco is expected to be completed in the first quarter of 2014 and will be financed through both cash and debt.
JP Morgan advised Haeco and Jefferies advised Owl Creek.