US group may invest in FLS Aerospace

US group United Technologies has emerged as a potential investor in FLS Aerospace, owner of the former TEAM Aer Lingus.

It is believed to have expressed an interest in taking a stake in the troubled aircraft maintenance group, which was purchased from Aer Lingus in 1998.

The president of FLS Aerospace, Mr Stephen Henderson, has said it would sell out if a suitable bid emerged. He said outside investment was needed to secure the future growth of the group, whose key problem was "under-performance". It employs 1,800 at Dublin Airport.

A United Technologies spokesman in Connecticut declined to comment. An FLS spokeswoman also declined to comment.

The US group is believed to be one of those identified by FLS Aerospace as a potential investor in its business. Its parent, FLS Industries, yesterday reported an operating loss of 458 million Danish kroner (€61.37 million) for 2000, down from a 475 million krone profit in 1999. Revenues fell to Dkk19.2 billion from Dkk20.99 a year earlier.

"The poor results for 2000 are due to restructuring, lack of orders and operating losses, notably from two projects in the US," it said.

FLS's other subsidiaries operate in the engineering and cement industries. The group forecast a Dkk700 million profit before tax and interest on revenues close to Dkk21 billion.

While precise year-end figures for FLS Aerospace were not available yesterday, its parent said the maintenance group became profitable in the last three months of the year.

Such profits are thought to be small. They follow what managers at FLS Aerospace termed a "drastic turnaround project" last year. As part of that plan, 60 workers left the group.

In the first nine months of the year, FLS Aerospace reported a Dkk427 million loss before interest and tax.

Its parent yesterday said improved efficiency and higher contract prices would lead to "normalised" level of earnings by the end of 2001.

With a market capitalisation of $38.55 billion (€41.5 billion), United Technologies is a major operator in the global aerospace business. Its operations include the Pratt & Whitney aircraft engines business and the Sikorsky helicopter company. Revenues last year were $26.6 billion.