PARIS — Safran has launched a jointly agreed upon offer for Zodiac Aerospace to create a leading aircraft equipment maker with a combined annual sales of some €21.2 billion (US $22.7 billion), the two companies said in a joint statement about Thursday's bid.
The combined group is expected to post a €2.7 billion annual operating profit and has identified €200 million of synergies from the deal, the companies said.
"The acquisition of Zodiac Aerospace represents a unique opportunity at this point in Safran's development, just a few months after initiating the refocus of the group on our core activities of aerospace and defense," Safran CEO Philippe Petitcolin said.
Zodiac's agreeing to be bought out comes just three months after US competitor B/E Aerospace agreed to Rockwell Collins' $6.4 billion offer.
French President François Hollande welcomed "this beautiful industrial transaction which strengthens the French aeronautics industry," the president's office said.
France, which holds 14 percent of Safran, supports the planned deal. The government will remain a shareholder in the combined group.
Safran builds the M88 engine for the Rafale fighter plane, while its Safran Electronics & Defense unit supplies opto-electronic sensors, Patroller tactical UAVs and other military equipment. Safran E&D had 2015 sales of some €1.27 billion.
The acquisition will forge the second-largest supplier of aircraft equipment, with annual sales of some €10 billion in that sector, the companies said.
Zodiac, which specializes in aircraft seats, rejected in 2010 an offer from Safran. The former has struggled to supply Airbus and Boeing with seats and toilets for their airliners.
The offer values Zodiac at just over €8.5 billion, Reuters reported.
"We are delighted to participate in the combination of two leaders of the industry with complementary positions and strong innovation abilities dedicated to their customers," said Didier Domange, chairman of Zodiac's supervisory board.