GE Aerospace to buy castings supplier for nearly $12 billion to tackle engine bottleneck

Key Points:

• GE Aerospace is acquiring Precision Castparts (CPP), a major maker of precision sand castings, to address supply-chain constraints and meet strong demand for new engines and aftermarket parts, marking GE Aerospace's largest acquisition since becoming a standalone company in 2024.
• CPP is a key supplier for GE's LEAP and GEnx engines and generates about 70% of its revenue from commercial and defense engines; GE expects CPP to generate approximately $2 billion in revenue by 2027.
• The acquisition aims to increase casting capacity by improving factory yields and reducing scrap, helping GE manage competing demands from aircraft makers and airlines for new engines and repairs, with an expected rise in airfoil demand of over 30% by 2030.
• GE also plans to accelerate new engine technology production by integrating airfoil design and manufacturing, which can improve engine durability and efficiency, thereby shortening development times and facilitating faster production ramps.
• The $17 billion deal, valued at about 26 times CPP's expected 2027 core profit before synergies, will be funded with $7 billion in cash and the rest through new debt, and is expected to close in the second half of 2027.