Hanwha Techwin signs US$4.5b supply deal with Pratt & Whitney

[THE INVESTOR] Hanwha Techwin has secured a multibillion dollar supply deal with the world’s third-largest aerospace engine maker Pratt & Whitney, it disclosed on Sept. 22.

The firm said it signed a deal with US-based P&W to supply US$4.5 billion worth of aircraft engine parts over the next 40 years. 

The parts will be manufactured by P&W’s Singapore-based joint venture, in which Hanwha will be taking up a 30 percent stake. The two sides declined to reveal the acquisition costs. 

Assuming it exercises a call option to acquire the remaining 70 percent stake in the JV after 2023, Hanwha estimated total sales to reach up to US$10 billion.

In 2015, Hanwha had signed two supply contracts worth US$1.7 billion and US$3.8 billion with P&W in June and December, respectively.

Hanwha is the first Korean firm to directly take part in managing an overseas manufacturing operation of a global aerospace company.

By Kim Ji-hyun (jemmie@heraldcorp.com)