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Precision Castparts' latest deal is looking sweet these days
Engine parts maker Precision Castparts Corp. spent much of the latter half of the 1990s assuring Wall Street it was lessening dependence on aerospace customers. Last year, however, it suddenly reversed course, announcing it would acquire aerospace rival Wyman-Gordon for $784 million.
The move worried some observers because it apparently halted PCC's drive toward diversification. But with Wyman-Gordon on the books now for two quarters, revenue, earnings and share price are on the rise. Thanks in part to a rebound for the aerospace industry that occurred sooner than expected, PCC is reaping rewards from Wyman-Gordon even earlier than its executives originally anticipated.
"This acquisition was so full of potential value for our shareholders that we could not pass it up," said CEO and board chairman William McCormick in the company's most recent annual report.
The move indeed bumped up Precision's dependence on aerospace orders. The company …