Precision Castparts Up On Carlton Forge Deal

PORTLAND, Ore. (AP) — Shares of Precision Castparts Corp. jumped Thursday after it said it would pay $850 million to buy Carlton Forge Works, which makes parts for aircraft engines and is a key supplier for the Boeing 787 and Airbus XWB aircraft.

The purchase, expected to be completed around late fall, will contribute immediately to Precision Castparts' earnings, the company said.

Carlton, which uses nickel, titanium and steel to make seamless rolled rings for aircraft engines and gas turbines, operates one facility in Paramount, Calif., a region where Precision Castparts operates several plants.

As part of the transaction, Precision Castparts also will buy Arcturus Manufacturing Corp., a hammer forging operation in Oxnard, Calif.

Broadpoint AmTech analyst Peter Arment upgraded the shares to "Buy" from "Neutral" and raised his price target to $105 from $74.

In Thursday morning trading, Precision Castparts shares traded at $93.99, an increase of 8.3 percent, or $7.22. It closed at $86.77 on Wednesday, when the deal was announced.