A subsidiary of China's biggest plane maker has sealed the purchase of Teledyne Technologies' piston engine business in a US$186 million transaction, which marks a key step for the Chinese firm to tap the global aviation industry.
AVIC International Holding Corp, a subsidiary of Aviation Industry Corp of China, bought the entire stake in Continental Motors Inc and Mattituck Services Inc through its subsidiary Technify Motor (USA) Inc from United States-based Teledyne.
AVIC International said the acquisition is vital in its strategy.
"China is gradually opening its low-altitude airspace and the deal will pave the way for the development of the domestic general aircraft market," said Wu Guangquan, president of AVIC International.
The Chinese civil aviation regulator has said previously that it would fully open the country's low-altitude airspace to support the general aviation industry by 2015.
The Civil Aviation Administration of China has already opened the low-altitude airspace in Jilin, Guangdong and Heilongjiang provinces on a trial basis. It will add the provinces of Hunan and Hubei as well as the autonomous regions of Guangxi and Inner Mongolia to the pilot project soon.
As part of its overseas expansion AVIC's subsidiary China Aviation Industry General Aircraft Co Ltd had previously said it would buy a 100-percent stake in US Cirrus Industries Inc, while another subsidiary CATIC Beijing Co Ltd acquired 20 percent in Germany's KHD Humboldt Wedag International AG for 45 million euros (US$66 million) to become its biggest shareholder.
The sale of Teledyne's business allows the firm to focus on its core commercial electronics and instrumentation business, said Robert Mehrabian, its chairman.
Continental Motors is a leading manufacturer of piston engines, spare parts and components that are used in small propeller-driven general aviation aircraft.