ST Aerospace wins $208m aircraft conversion deal

SINGAPORE Technologies Aerospace (ST Aerospace) has clinched a landmark US$136 million (S$208 million) deal to convert Boeing 767-300 passenger jets to cargo planes.

The work will be done by ST Aerospace's subsidiary ST Aviation Services Company (Sasco) at its Paya Lebar facility.

Sasco is the first company picked by the American aircraft manufacturer to convert the B767-300 mid-sized plane.

The first five converted aircraft will be delivered to Japan's All Nippon Airways.

At the signing ceremony yesterday, Mr Marco Cavazzoni, Boeing's vice-president of freighter conversions, and ST Aerospace president Tay Kok Khiang said both companies have enjoyed a long and excellent partnership.

Mr Cavazzoni said: 'I am confident that ST Aerospace will continue to support Boeing in delivering a converted freighter that is economical to maintain and operate.'

Since the firm entered the passenger-to-cargo conversion business 15 years ago, ST Aerospace has completed close to 100 makeovers.

Neither ST Aerospace nor Boeing would reveal the total number of B-767 planes that the Singapore company will work on over the 10-year term of the contact.

The outlook for the passenger-to-cargo conversion business is positive.

By 2025, 2,990 aircraft will be added to freighter fleets around the world, with three out of four of those planes being converted from passenger jets, according to industry estimates.

ST Aerospace said the Boeing contract is not expected to have any material impact on its net assets per share or earnings per share this financial year.