The sale of Volvo Aero Services is due to Volvo Aero’s strategy of focusing on its core operations of developing and manufacturing components for aircraft engines, combined with the goal of reducing the company’s tied-up capital.

“This decision is in line with our strategy to grow as a component manufacturer in the aerospace industry,” says Volvo Aero’s President, Staffan Zackrisson. “Over time, we have seen that the synergies between our operations and those conducted by Volvo Aero Services are minimal.”

The operations pertaining to maintenance of engines and gas turbines currently carried out in Trollhättan will not be impacted by the transaction.

The sale is expected to have a negative impact of approximately SEK 200 M on the Volvo Group’s operating income during the second quarter. The sale is among other things contingent on customary approvals being obtained and completion is expected to take place in the third quarter of 2010, at which point it is forecast to have a positive effect of about SEK 400 M on the Group’s net financial debt.