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Exclusive-Carlyle mulls $10 billion sale of StandardAero, sources say

FILE PHOTO: The logo of The Carlyle Group is displayed at the company's office in Tokyo

By David Carnevali

(Reuters) - Private equity firm Carlyle Group is weighing strategic options, including a sale, for StandardAero that could value the U.S. aircraft maintenance services provider at about $10 billion, including debt, people familiar with the matter said.

Carlyle's deliberations come as the aviation sector recovers from the slump of the COVID-19 pandemic and as its peers capitalize on a rise in mergers and acquisitions to cash out on their investments.

Carlyle is in the early stages of evaluating options for StandardAero and is working on selecting advisors to lead the review process, the sources said. An initial public offering of the company is also under consideration, one of the sources added.

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There is no certainty the deliberations will lead to any deal, the sources said, requesting anonymity because the matter is confidential.

Carlyle declined to comment. A spokesperson for StandardAero did not immediately reply to a request for comment.

Founded in 1911, StandardAero provides maintenance, repair and overhaul services to commercial and military aviation, as well as energy, clients. The Scottsdale, Arizona-based company partners with major aircraft engine makers, including Rolls-Royce and GE Aerospace -backed CFM International.

StandardAero generated revenue of $4.6 billion in 2023 and is expected to post high single-digit percentage sales growth and mid-single digit percentage earnings growth this year, credit ratings agency Moody's said last week.

Carlyle acquired StandardAero from buyout firm Veritas Capital for approximately $5 billion in 2019. Cashing out would be a major boon to Carlyle after its private equity business reported a big drop in realized proceeds to $13.5 billion in 2023 from $22.5 billion in 2022.

An improved financing market is allowing more private equity firms to exit their investments, often by selling companies to buyout peers. Earlier this week, BC Partners inked a $4 billion deal to sell a majority stake in information technology provider Presidio to Clayton Dubilier & Rice, and Welsh Carson Anderson & Stowe agreed to sell compliance software maker Avetta to EQT for about $3 billion.

(Reporting by David Carnevali in New York; Editing by Chizu Nomiyama)