(Reuters) - BBA Aviation Plc (BBA.L) said on Tuesday it would sell its Ontic aircraft parts and services unit to private equity firm CVC Capital Partners in a $1.37 billion deal, as it focuses on its mainstay airport services business.
The sale leaves the company with its Signature unit, which provides a range of services including passenger handling, office rentals and aircraft parking.
The company said the deal, which is unanimously supported by its board, should return between $750 million and $850 million to shareholders.
BBA bought the Ontic business in February 2006 for $67 million, and has expanded the unit through acquisitions of licences for aircraft parts, the company said.
Sales at the unit, whose major customers include Boeing (BA.N), Airbus (AIR.PA) and British Airways (ICAG.L), accounted for 15% of the company’s overall underlying operating profit in 2018. It reported revenue of $216 million last year.
The company said in May that it was performing in line with expectations, with revenue for the four months ended April 30 up 23% year-on-year, boosted by acquisitions of EPIC, Firstmark and Ontic licences acquired during 2018.
Revenue at the Signature unit rose 22.7% for the period, the company had then said.
Reporting by Justin George Varghese in Bengaluru; editing by Patrick Graham and Saumyadeb Chakrabarty