Fasteners Still Profitable for Fairchild Corp.
Fasteners Still Profitable for Fairchild Corp.
Jason Sandefur
Five years after it sold its fastener operations to Alcoa, the Fairchild Corp. continues to profit from the fastener industry. Fairchild reported a $12.5 million gain in the fourth quarter of 2006 as part of an earn-out from its fastener business.
Alcoa acquired aerospace fastener manufacturer Fairchild Fasteners in 2002 for $657 million in cash. Alcoa combined Fairchild Fasteners with its Huck Fasteners business to form Alcoa Fastening Systems.
Industry analysts viewed the Fairchild sale as coup for Fairchild CEO Jeffrey Steiner during a volatile period in the aerospace industry. Fairchild Fasteners sold for more than nine times its operating profit of roughly $70 million.
The deal also brought Steiner some less than savory press coverage when the Washington Post revealed Steiner conducted a “triple dip” on the sale.
“Steiner received $3.1 million, part of a golden parachute from Fairchild, without bailing out,” Post reporter David Hilzenrath wrote in 2004. “He also received a $5.2 million bonus from Fairchild for his work on the deal. And he and his son Eric, president and chief operating officer, got a noncompete and consulting contract with Alcoa worth $5 million over four years.” �2007 FastenerNews.com
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