Earnings
Home›Earnings›Guidance›GE Aerospace deal for Consolidated Precision Products…
GE Aerospace deal for Consolidated Precision Products pressures Howmet shares
GE Aerospace plans to fund about $7.0 billion of the roughly $11.75 billion purchase with cash and the rest with newly issued debt, targeting higher adjusted EPS and free cash flow after closing.
GE Aerospace agreed to acquire Consolidated Precision Products for about $11.75 billion, a move aimed at locking in high-temperature casting supply for the commercial jet engine backlog. The transaction is expected to create a ripple effect across the supply chain tied to the foundry bottleneck that has constrained aviation deliveries. Following the announcement, Howmet Aerospace shares retreated around 10% as investors weighed concerns that GE could bring more components in-house. MarketBeat Ratings frames the reaction as a question of whether the deal turns the relationship into a zero-sum contest, or instead reflects an expanding demand cycle for complex turbine castings. GE’s interest centers on investment castings made from nickel and cobalt superalloys, including single-crystal airfoils that operate at extreme temperatures for the CFM LEAP engine family used in most global narrowbody passenger jets. By owning the supplier, GE Aerospace would gain priority over its multi-year commercial backlog, while Howmet remains exposed to how demand is allocated across the engine supply chain. On financing and performance, GE Aerospace intends to cover roughly $7.0 billion of the purchase price with cash on hand and fund the remainder through newly issued debt. Company leadership also said the acquisition is expected to boost adjusted earnings per share and free cash flow in the first full year after closing, with planned dividends and capital allocation programs left undisturbed. Consolidated Precision Products has more than 20 production facilities and about 6,600 specialized workers across North America and Europe.