Pratt & Whitney subsidiary United Technologies International Corporation-Asia Private Limited, and Hanwha Techwin Co., Ltd. have signed an agreement for Hanwha to acquire a 30 percent equity interest in P&W NGPF Manufacturing Company Singapore Pte. Ltd. (PWMS). Under this joint venture arrangement, Pratt & Whitney retains control of the sourcing of critical parts while sharing capital investment requirements with Hanwha. Hanwha also acquired a call option from Pratt & Whitney to purchase additional equity as early as 2023. The Singapore facility specializes in the manufacture of hybrid metallic fan blade parts and high-pressure turbine disks for the PurePower® Geared Turbofan™ (GTF) engine family. Pratt & Whitney is a division of United Technologies Corp. (NYSE: UTX).
In conjunction with this agreement, Pratt & Whitney and Hanwha are expanding their risk and revenue sharing collaboration, increasing Hanwha's program share on both Pratt & Whitney's 24,000- (24K) and 30,000 (30K) pound thrust GTF programs by one percent each. This brings Hanwha's program share to three and two percent respectively, to complement a one percent program share on the 17,000 pound thrust GTF engine program.
Hanwha has worked with Pratt & Whitney on the GTF program since the first development engine, and they have performed very well in their execution of highly sophisticated parts assembly. Building upon that achievement, Hanwha converted from supplier to risk revenue sharing partner in June 2015. In December 2015, Hanwha joined the 30K program as a risk revenue sharing partner and today's arrangement not only increases Hanwha's program shares but also creates a manufacturing collaboration between the parties.
Through Hanwha and Pratt & Whitney's expertise, the PWMS facility will enhance delivery of GTF fan blades and high-pressure turbine disks more efficiently at a faster ramp to Pratt & Whitney's sites across its global network so as to meet Pratt & Whitney's increased orders demand.
"The acquisition of Samsung Techwin by Hanwha in June 2015 created what we believe is a generational opportunity for both companies," said Dave Emmerling, vice president, Strategy and Business Development, Pratt & Whitney. "Hanwha's capabilities and performance, combined with their willingness to invest, positions them well to maintain a strong relationship with Pratt & Whitney both today and into the future."
"Having recently expanded our Changwon #2 factory with a new building, the time was right for us to acquire an interest in an overseas engine parts manufacturing facility. We really like the state of the art Singapore facility and intend to be there for the long haul," said Hyun Woo Shin, chief executive officer, Hanwha Techwin, Co., Ltd.
The parties intend for the transaction to close by Sept. 30. In addition to the parts to be made in the Singapore facility, Hanwha produces mid turbine frames, diffuser cases, high pressure split cases and nickel integrally bladed rotors for Pratt & Whitney's family of Geared Turbofan Engines.
Pratt & Whitney is a world leader in the design, manufacture and service of aircraft engines and auxiliary power units. United Technologies Corp., based in Farmington, Connecticut, provides high-technology systems and services to the building and aerospace industries. To learn more about UTC, visit its website at www.utc.com, or follow the company on Twitter: @UTC.
This press release contains forward-looking statements concerning future business opportunities. Actual results may differ materially from those projected as a result of certain risks and uncertainties, including but not limited to the scope, nature, impact or timing of the transaction, changes in levels of demand in the aerospace industry, in levels of air travel, and in the number of aircraft to be built; challenges in the design, development, production and support of advanced technologies; as well as other risks and uncertainties, including but not limited to those detailed from time to time in United Technologies Corps.' Securities and Exchange Commission filings.