After 10 years of ownership by a UK fund, Italian space launcher maker Avio Space is to fall once again under Italian control.

The firm will be sold by UK fund Cinven to Italian firms Space2 and Leonardo, Cinven said on October 20, following the fund's purchase of the operation in 2006.

With an equity value of 160 million euros, Avio Space builds the Vega launcher, employs 800 people and saw 279.2 million euros in revenue last year.

State controlled Italian defense firm Leonardo already held 14 percent in Avio and thanks to the transaction will increase its stake to 28 percent.

The firm said it would pay about 43 million euros and close the deal by the first quarter of 2017.

Space2 is operated by a group of Italian investors. Through a complex financial operation involving the listing of Avio on the Italian stock exchange, Leonardo is set to become a controlling shareholder in the firm, one Italian source said.

Leonardo CEO Mauro Moretti said the deal would strengthen the firm's focus on its key activities of aerospace, defense and security and could bolster the work of its ongoing space joint venture with Thales.

Avio's recent history has witnessed a series of changes of ownership.

Italy's Fiat formerly controlled it as part of a larger business, also known as Avio, which handled aircraft propulsion.

In 2003 Fiat sold Avio to US fund Carlyle, before Cinven bought it in 2006 for 2.57 billion euros. Cinven then sold the aerospace activity to General Electric in 2013 for 3.3 billion euros, holding on to its majority stake in Avio's space activity.

A deal to sell the space activity to Leonardo has long been in the works, but was held up by restructuring at the Italian firm. Avio's space business is subject to Italy's 'Golden Power' legislation, which give the Italian government some strategic control over the firm. Italian officials have previously mulled bringing in Airbus or Safran as partners to Avio.

Cinven's control of the various Avio activities over ten years has produced a 2.3-fold return on its investment, a source told Defense News.

Tom Kington is the Italy correspondent for Defense News.

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