22 Jul 2020
Posted in Aerospace, Defense & Security
UAE builds up local industry and talent with AMMROC purchase
Following the news that the UAE’s EDGE Group announced a conditional purchase of the remaining 40% shares held by Lockheed Martin and Sikorsky in Advanced Military Maintenance Repair and Overhaul Center (AMMROC);
Mathew George, Ph.D., Aerospace & Defense Analyst at GlobalData, a leading data and analytics company, offers his view:
“EDGE Group’s purchase will make AMMROC a fully owned company of the EDGE group upon completion and helps the company round out the capabilities it provides for the region. Lockheed Martin mentioned this deal in its earnings call, as a non-cash impairment charge of US$128m, that it agreed to sell.
“For EDGE, AMMROC is the only authorized C-130 maintenance, repair and overhaul (MRO) center in the region providing services for the F-16 and is an MRO hub for Black Hawk components. This can be seen as a strategic step from Lockheed to go from having to run a center to having an invested and interested partner. This will ensure Lockheed products will have a local interest in being bought and serviced from within the Middle East, if not from only the oil rich Gulf states or the Gulf Cooperation Council.
“Beyond the military, though, the civil aerospace MRO market will be a lucrative one that EDGE will not shy away from. Gulf air carriers are the largest in the world with sufficient resources and crews for in-house maintenance, however, there will still be the need for specialist skills that EDGE can advertise and capitalize on.
“The UAE, like others in the region, have been slowly developing local industry to move away from an oil economy, and EDGE was UAE’s offering in the defense space. This purchase stems from the interest to not just have a completely local offering, but also build the brand of UAE in the world, just like Emirate Mars Mission.”