Bloomberg – Italy’s aerospace giant Leonardo SpA says ATR, which it co-owns with France’s Airbus SE, is in talks with alternative buyers for the remaining aircraft in a 1 billion euro ($1.6 billion) deal with Iran, which it can no longer deliver due to sanctions.
“We are pretty confident that we will finalize the re-allocation to other countries” by the end of this year, Chief Executive Officer Alessandro Profumo said in an interview with Bloomberg TV at the Ambrosetti Forum in Cernobbio, Italy. Profumo said 12 new generation ATR 72-600 aircraft ordered by Iran in 2016 have already been delivered, while eight remain and will be allocated elsewhere.
The company doesn’t expect “any meaningful impact” on ATR and Leonardo from sanctions imposed by the U.S. to punish the Iranian regime, given the reallocation. Leonardo has no other deals with Iran, Profumo said. The ATR joint venture “is performing well.”
Leonardo shares rose as much as 5.2 percent Monday and were trading at 10.2 euros per share after Bloomberg News reported on the talks.
Separately, Profumo also said he is happy with the current state of Leonardo’s helicopter division, which underwent a downturn last year that prompted a guidance revision and stock drop.
The aerospace and defense market “is expected to grow over the next five years in a range of 6 percent,” Profumo said. “Our target is to grow in line with the market.”
(Updates with share price increase in the fourth paragraph.)