There are many roads to acqui­sitions, but working together on a contact for a customer is one less traveled.

But this was the road traveled by Sagem, a leading European communication, defense and se­curity company with about $3 bil­lion in annual sales and headquarters in Paris, and Arnav Systems, a small avionics com­pany with about $2 million in sales last year and one location in Puyallup, Wash. Late on Monday afternoon here at Heli-Expo, the two companies announced that Sagem, through its U.S. sub­sidiary Sfim, had acquired Arnav on Friday, March 12.

Sagem also took the opportu­nity to announce that Sfim (Booth Nos. 849 and 869), based in Grand Prairie, Texas, had been formally renamed Sagem Avion­ics. (Sagem acquired Sfim four years ago, but kept the Sfim name in the U.S.) Sagem Avionics con­tinues Sfim's responsibility for marketing, sales and customer support of Sagem's line of heli­copter autopilots, electromechani­cal actuators, flight data recorders and data-management/interface units. Slim and Arnav are joined under the Sagem Avionics banner.

As Jacques Paccard, Sagem president, defense and security, said of Sagem's acquisition of Arnav, "It's like an elephant eat­ing a mouse." But he meant it in a nice way. Frank Williams, for­mer president and principal in­vestor in Arnav and now v-p of Sagem Avionics' Washington lo­cation, was all smiles during an interview with HAI Convention News after the champagne cere­mony following the announce­ment. The companies formerly known as Sfim and Arnav have, respectively, about 30 and 18 em­ployees. Layoffs as a result of the acquisition are not anticipated.
Sagem/Sfim and Arnav met after being contracted separately by Erickson Air-Crane of Central Point, Ore., to develop a glass cockpit and digital flight control system, along with Rockwell Collins and Garmin, for the Erick­son Air-Crane S-64 Helitanker. Erickson acquired the type certifi­cate, tooling and documentation for the Sikorsky 5-64 Skycrane in 1992 and since then has built 14 Erickson Aircranes for itself, with a 15th due to be finished this June. The Oregon helicopter oper­ator/manufacturer has also built one Aircrane for a Korean cus­tomer, delivered in February 2002, and is building four more for the Italian state forestry corps (Corpo Forestale Dello Stato, or CFS). The delivery of the first Er­ickson S-64 to the Italians is planned for June, the second by the end of this year and the other two in 2005. The CFS also holds options for two more S-64s.

It is for the CFS S-64s that Sfim, Arnav, Rockwell Collins and Garmin were contracted inde­pendently to design and certify the glass cockpit and automatic flight control system, but Erick­son also plans eventually to retro­fit all its own S-64s with the new avionics and autopilot. Heritage Aviation in Dallas did the installation of the systems for the first Italian helicopter and will do the flight testing and certification work. After certification, Heritage will assemble the kits for the sec­ond, third and fourth CFS S-64s for installation by Erickson at its facility in Central Point.

Arnav and Sagem personnel first met about a year ago. As they began working together over the following months, there came a realization that their product lines meshed. It also became apparent to both that Arnav's fortunes had taken a hit after 9/11, before which its annual sales were in the $5 million range, according to Williams. Last year's gross rev­enues were about $2 million. Some three months ago, the two companies began to discuss Sagem's acquisition of Arnav. As mentioned before, the deal closed on March 12.

The next step for Sagem Avionics, agreed Paccard and Williams, is to determine the mar­kets that would be natural for the combined companies' products. Sagem brings experience in heli­copter autopilot systems, actua­tors and flight-data recorders to the partnership, while Arnav's ex­pertise is in LCD cockpit dis­plays, digital navigation, data processing, communication sys­tems, airborne weather service and satellite phones.

More specifically, Williams said they will look for the heli­copter models that would be likely markets for the elements of the 5-64 glass cockpit and flight con­trol system developed by Arnav and Slim. Because of its similarity to the S-64, the Sikorsky S-61 comes readily to mind, but Sagem Avionics will be looking at retro­fit possibilities for other helicopter models as well.

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About Sagem Avionics, Inc.

Sagem Avionics, Inc. a company incorporated in the US with headquarters in Dallas, Texas is a wholly owned subsidiary of Sagem, a Safran group company. Sagem Avionics, Inc. provides high quality avionics products and services to Part 23, 25, 27, and 29 aircraft and helicopters. These include technical support, MRO services, and marketing and sales of Sfim, Arnav, Aviac and Sagem commercial aerospace products including integrated cockpit display systems, helicopter autopilot systems, flight control components, aircraft condition and monitoring systems, and flight operations quality assurance software.

For further information: www.sagemavionics.com