By Seda Sezer and Andrea Shalal
Source: Yahoo Finance
Feb 21 (Reuters) - Turkey signed a
deal worth $3.5 billion on Friday to buy helicopters from United
Technologies Corp's Sikorsky Aircraft unit, finalizing an order
originally agreed upon in 2011, the prime minister said.
The
agreement includes options that analysts say could result in billions
of dollars of additional orders over the next three decades.
The
109 helicopters, a version of Sikorsky's popular Black Hawk, will be
assembled in Turkey. The main contractor is Turkish Aerospace Industries
with components to be supplied by Sikorsky, Aselsan and other Turkish
companies.
"Turkey is such an important market in terms of being a large customer, and it is also strategically important in terms of who they are in the world," Sikorsky President Mick Maurer said in a telephone interview.
He said the agreement would allow Turkish industry to develop the capability to produce nearly every part of the helicopter, including a newly designed Turkish cockpit.
Maurer declined to give many details about the new agreement but said it would give his company a second source for many of the helicopter's components.
He said Sikorsky would work with Turkey to market the international version of the Black Hawk in other countries, leveraging Turkey's existing relationships in those areas and generating additional orders for Turkish suppliers.
"We're
going out arm in arm, as we bring in other sales outside of Turkey that
will be supplied by the new supply chain," Maurer said.
Maurer said the company expected continued demand for the helicopter in Asia, the Middle East and Europe.
Even
if the co-marketing efforts do not pan out, the deal still gives
Sikorsky access to "one of the biggest export helicopter markets in the
world," said aerospace analyst Richard Aboulafia. "Turkey has
requirements that go way beyond these numbers," he said.
Virginia-based
defense consultant Jim McAleese said the deal would help Sikorsky
weather a downturn in U.S. helicopter orders and underscored the
"franchise value" of the company just weeks after speculation that
United Technologies could spin it off as a low-value asset.
"This could not have come at a better time," McAleese said.
Despite
the deal, Sikorsky on Friday announced it would begin laying off 600
workers in coming weeks, citing continued "challenging and unstable
economic conditions."
Sam
Mehta, president of Sikorsky's Defense Systems and Services division,
said the deal marked the start of a 30-year relationship, and included
options for a wide range of Turkish government agencies to buy versions
of the helicopter.
It also opened opportunities for servicing and repairing the helicopters, he said.
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