Sumitomo Corporation - Acquisition of Aftermarket Aircraft Spare Part Supplier Werner Aero
August 04, 2022 at 07:50 am EDT
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Sumitomo Corporation (Head Office: Chiyoda-ku, Tokyo; Representative Director, President and Chief Executive Officer: Masayuki Hyodo) through Sumitomo Corporation of Americas has acquired 51% shares of Werner Aero, LLC, an after-market aircraft spare parts supplier who specializes in aircraft end-of-life solutions including aircraft part-out of retired aircraft to sell used serviceable parts for maintenance use.
Although demand in commercial aviation has taken a blow due to COVID-19, IATA (The International Air Transport Association) estimates revenue passenger-kilometers will recover to pre-pandemic levels by around 2023 and growth will continue driven by short and medium haul routes. In addition to this aviation demand recovery, due to the recent material costs rise and a stronger pressure for airlines to reduce costs, demand for used aircraft parts, with price lower than that of new parts, is expected to grow.
For the past 30 years, Werner has built strong relationships with airlines worldwide, alongside their advanced capability of procurement, sales and management of used aircraft and parts. Werner has focused on dealing regional jet and narrow-body aircraft which are used for short and medium haul routes. The group has kept its business secure despite the pandemic through its solid management.
Sumitomo Corporation Group's aviation business includes entities such as SMBC Aviation Capital, one of the leading global companies in the aircraft leasing industry and SMBC Aero Engine Lease, which is an aircraft engine leasing company. Sumitomo Corporation will apply its credibility, financial resources, alongside its expertise in the aviation market to enhance Werner's business, and also work to exploit operational synergies with the abovementioned and other group entities.
Sumitomo Corporation will expand the aircraft aftermarket parts bussiness to promote the effective use of resources through the reuse and recycling of aircraft parts, and contribute to the sustainable and stable growth of the aviation industry.
Sumitomo Corporation is a diversified group organized around 7 areas of activity:
- retail distribution of consumer goods (24.4% of net sales): food products, apparel and accessories, pharmaceuticals, building materials, household and decorative items, etc. The group is also developing a real estate business;
- trading of hydrocarbon, mining, chemicals and electronics products (24%): oil, natural gas, copper, gold, silver, zinc, lead, nickel, coal, iron ore, resins, pesticides, petrochemical products, etc.;
- trading of steel products and non ferrous metals (20%): flat and long steel products, tubular products, aluminum products, titanium, etc.;
- distribution of transportation and construction systems and equipments (15.1%): spatial equipments, landing fields, forest machines, motorcycles, mining operating vehicles, etc.;
- telecommunications and multimedia products and services supplies (8.8%): TV wiring, data communication solutions, film distribution services, mobile telephony, Internet access and computing services;
- development and implementation of civil engineering infrastructures (7.6%): power plants, wastewater treatment units, industrial plants, telecommunications centers, etc. The group is also providing logistics services;
- other (0.1%).
SUMITOMO CORPORATION 
