GKN agrees sale of helicopter company stake

British engineering group GKN said today it had rubber-stamped a deal to sell its stake in helicopter maker AgustaWestland for £1.06bn (€1.6bn).

The Redditch-based company said it had signed definitive agreements to dispose of its 50% interest in the Yeovil-based aerospace business to Italian engineer Finmeccanica, which holds the other 50%.

The deal now needs only the approval of GKN shareholders and regulators to proceed.

The move ends British ownership in the helicopter industry, which is now dominated by North American and continental European players such as Sikorsky, Boeing, Bell and Eurocopter, owned by European aerospace group EADS.

GKN said the sale would allow it to cut its debt and to use selective acquisitions to strengthen its automotive business and its other aerospace activities.

Chief executive Kevin Smith said: “The proposed sale represents good value for GKN shareholders and places GKN in an excellent position for its future development.”

Agusta was formed as a joint venture in February 2001 from the merger of GKN and Finmeccanica’s respective helicopter businesses.

It produces commercial and military helicopters, including the light single-engine A119 Koala, the three-engine multi-role EH101, the Super Lynx 300 and the Apache AH MK1.

In May, aerospace group BAE Systems played down a report that it was in talks with Finmeccanica to take a 40% stake in Agusta.