) has agreed to take over two flight simulation and aircraft
training product companies - Mechtronix Inc. and OPINICUS
Corporation. Although the company did not disclose the financial
terms of the acquisitions, Textron expects to close both
transactions by the end of this year.
Located in Montreal, Quebec, Mechtronix mainly focuses on the
civilian airline market and its key products include the FFSX and
FFTX line of high-fidelity simulators and the FFT and Ascent line
of flight trainers, as well as classroom training solutions.
On the other hand, OPINICUS is known for its ODYSSEY
high-fidelity simulators, which have REALFeel control loading and
REALCue motion controller. It has delivered turnkey simulator
programs to many aviation industry behemoths including
The Boeing Co.
Lockheed Martin Corp.
), Bell Helicopter, GE Aerospace, the Federal Aviation
Administration ("FAA") as well as various branches of the U.S.
Together these two acquisitions will be integrated into Textron
Systems' existing training and simulation business. The new
division will be called Textron Simulation & Training Systems
and following the completion of the transactions is expected to
fetch revenues in excess of $100 million a year. Textron's
present training and simulation unit serves the military aircraft
market through its facilities in Goose Creek, S.C.
Textron's move into the aircraft pilot training market is aimed
at plugging the gap in pilot shortage. This shortage is due to
retirements, greater training requirements and more rest periods
between shifts. Recently,
United Continental Holdings, Inc.
) announced that it plans to recall about 600 pilots to fill gaps
from retirements and rest rules.
As per the media report in October, a University of North
Dakota study projected a shortfall of as many as 35,000 pilots
required for U.S. air fleet over the next 20 years.
Textron is a global multi-industry company that manufactures
aircraft, automotive engine components, and industrial tools. The
company's geographically-diverse network of aircraft, defense
& intelligence, industrial and finance businesses negates any
specific business risk.
However, the company, like its peers, continues to face defense
budget deficits and political uncertainty. Though the company
received a number of contracts in the third quarter, those were
not sizeable. Budget cuts from sequestration have reduced the
number of contracts awarded by the Department of Defense.
Again, its third quarter earnings missed the Zacks Consensus
Estimate, hurt by a weak performance at Cessna. Textron also
lowered its 2013 earnings per share guidance from continuing
operations to $1.75-$1.85 from its previous expectation of
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Based in Providence, Rhode Island, Textron currently carries a
Zacks Rank #4 (Sell).