Strengthening National Aerospace: The EPI and Etihad Engineering Collaboration

We are witnessing a significant evolution in the United Arab Emirates’ industrial landscape, marked by a strategic convergence between the defense and commercial aviation sectors. At the Dubai Airshow 2025, a pivotal announcement was made regarding a collaboration between EPI, the precision engineering arm of EDGE Group, and Etihad Engineering, a global leader in MRO services. This partnership represents a calculated step toward localizing critical aerospace manufacturing capabilities.

The agreement focuses on the manufacturing and machining of aircraft wheel hubs, a vital component in the aviation supply chain. By moving this specific manufacturing process to domestic facilities, the collaboration aims to reduce dependency on international suppliers and enhance the operational efficiency of the UAE’s aviation sector. This move is not merely a commercial transaction but a structural shift intended to bolster the nation’s sovereign industrial capabilities.

For industry observers, this partnership signals the maturation of the UAE’s aerospace ecosystem. It demonstrates how precision engineering capabilities, originally honed for defense applications under EDGE Group, are being effectively transferred and applied to commercial aviation needs. We analyze the details of this agreement, the profiles of the entities involved, and the broader economic implications for the region.

Defining the Strategic Alliance

The core of this collaboration involves two heavyweights in the UAE’s industrial sector. EPI serves as the cornerstone of precision engineering for EDGE Group, known for manufacturing complex metallic components for air, land, and sea platforms. Their expertise extends to surface treatment, heat treatment, and coating, serving major global clients including Airbus and Boeing. On the other side of the agreement is Etihad Engineering, recognized as the largest commercial MRO facility in the Middle East. Recently acquired by Abu Dhabi Aviation (ADA), Etihad Engineering handles heavy maintenance and component repair for massive fleets, including the Airbus A380 and Boeing 787.

Under the terms of the agreement announced at the Dubai Airshow, the two entities will collaborate on the machining of aircraft wheel hubs. While this may appear to be a specific technical niche, the implications are broad. The ability to machine and repair these hubs domestically allows for faster turnaround times for aircraft maintenance. Instead of shipping components abroad for processing, a practice that incurs logistical costs and time delays, the work will now be performed within the UAE.

This initiative leverages EPI’s advanced manufacturing facilities to support Etihad Engineering’s MRO requirements. It is a practical application of industrial synergy, where the technical certifications and machinery of one entity resolve the supply chain needs of another. We see this as a clear example of how vertical integration within Abu Dhabi’s aviation sector is beginning to yield tangible operational benefits.

“This collaboration is a milestone for the ‘Make it in the Emirates’ initiative, driving industrial growth and aerospace self-sufficiency.”, Michael Deshaies, CEO of EPI.

Economic Impact and “Operation 300bn”

To understand the weight of this partnership, we must view it through the lens of the UAE’s national industrial strategy, “Operation 300bn.” This government initiative aims to increase the industrial sector’s contribution to the GDP from AED 133 billion to AED 300 billion by 2031. The collaboration between EPI and Etihad Engineering directly supports this goal by creating high-value industrial output within the country. By manufacturing aerospace-grade parts locally, the partners are contributing to the diversification of the economy away from oil dependence.

Furthermore, the deal is closely aligned with the In-Country Value (ICV) program. The ICV program is designed to redirect public and private spending back into the local economy. When Etihad Engineering pays EPI for machining services, that capital remains within the UAE’s financial ecosystem rather than flowing to foreign MRO shops or manufacturers. This retention of economic value is a critical component of sustainable development and national wealth generation.

The “Make it in the Emirates” initiative also plays a central role here. By localizing the production of wheel hubs, the UAE is transitioning from a buyer of aerospace technology to a manufacturer. This shift is essential for long-term economic resilience. It fosters a skilled local workforce, encourages technology transfer, and builds an industrial base capable of supporting complex engineering projects in the future.

Supply Chain Sovereignty and Future Implications

The global aviation industry learned harsh lessons regarding supply chain fragility during the COVID-19 pandemic. Disruptions in logistics grounded fleets and delayed essential maintenance worldwide. By establishing the capability to machine and repair critical components like wheel hubs domestically, the UAE is effectively insulating its aviation sector from future global supply chain shocks. This concept of “supply chain sovereignty” ensures that the nation’s fleets can remain operational regardless of external logistical challenges.

Looking ahead, we anticipate that this collaboration could serve as a template for further expansion. EPI is actively expanding its facilities to handle larger components and higher volumes, while Etihad Engineering targets a doubling of its revenue by 2030. If the machining of wheel hubs proves successful, it is plausible that the partnership will expand to cover other complex aircraft components. This could eventually lead to a scenario where a significant portion of aircraft MRO parts are manufactured or repaired entirely within the UAE.

The synergy between a defense-focused entity like EDGE and a commercial giant like Etihad Engineering also suggests a blurring of lines between military and civil industrial bases. This dual-use approach to industrial capability maximizes the return on investment for infrastructure and technology. As these entities continue to integrate their operations, the UAE solidifies its position not just as a global transit hub, but as a center of excellence for aerospace engineering and manufacturing.

Concluding Section

The collaboration between EPI and Etihad Engineering marks a definitive step forward for the UAE’s aerospace sector. By localizing the machining of aircraft wheel hubs, these entities are addressing immediate operational needs while contributing to the long-term strategic goals of “Operation 300bn” and the In-Country Value program. The partnership highlights the growing maturity of the local industrial base and its ability to deliver precision engineering solutions that meet rigorous international standards.

As we look to the future, the success of this initiative will likely encourage further cooperation between the defense and commercial sectors. The transition from importing solutions to creating them domestically is well underway, positioning the UAE to become a self-reliant powerhouse in the global aviation industry.

FAQ

What was announced by EPI and Etihad Engineering?
At the Dubai Airshow 2025, EPI and Etihad Engineering announced a strategic collaboration to manufacture and machine aircraft wheel hubs domestically within the UAE.

How does this benefit the UAE economy?
The partnership supports the “Operation 300bn” strategy and the In-Country Value (ICV) program by retaining economic value within the country and reducing reliance on foreign suppliers.

What are the roles of the companies involved?
EPI, a subsidiary of EDGE Group, specializes in precision engineering and manufacturing. Etihad Engineering is a leading global provider of aircraft Maintenance, Repair, and Overhaul (MRO) services.

Sources

• EDGE Group Press Release

Warburg Pincus Acquires Topcast: A Strategic Shift in Asia-Pacific Aviation

In a significant move for the global aerospace sector, Warburg Pincus, a leading global growth investor, has officially acquired Topcast Aviation Supplies Company Limited (“Topcast”). Announced on November 25, 2025, this transaction marks a change in ownership for the largest independent aircraft parts distributor and Maintenance, Repair, and Overhaul (MRO) service provider in the Asia-Pacific region. The Acquisitions sees Warburg Pincus taking over the majority stake previously held by the private equity firm Permira since 2019.

This deal underscores the growing importance of the Asia-Pacific region in the global civil aviation landscape. As air traffic rebounds and fleet expansions continue across markets like China and India, the demand for reliable supply chains and technical support has intensified. Topcast, headquartered in Hong Kong, sits at the center of this ecosystem, serving as a critical link between global suppliers and regional airlines. While financial terms of the transaction were not disclosed, the acquisition represents a high-profile commitment by Warburg Pincus to the aerospace aftermarket.

We view this acquisition not merely as a change of hands, but as a strategic alignment of capital and operational expertise. Warburg Pincus brings decades of experience in the aerospace sector, having previously invested in major industry players. By acquiring Topcast, the firm is positioning itself to capitalize on the projected multi-year upcycle in aviation, driven by supply chain complexities and the aging commercial fleet in Asia.

The Players and the Transaction

To understand the magnitude of this deal, it is essential to look at the profiles of the entities involved. Topcast was founded in 1991 and has grown into a dominant force in aviation logistics. Unlike subsidiaries of major airframe manufacturers, Topcast operates as an independent distributor. This status allows the company to aggregate products from over 800 suppliers, offering a neutral and comprehensive solution to customers in over 90 countries. With more than 20 offices globally and a workforce of approximately 200 people, Topcast combines global reach with deep local expertise.

Warburg Pincus’s Aerospace Pedigree

Warburg Pincus is no stranger to the complexities of the aviation industry. The firm has a well-documented history of investing in high-growth aerospace companies. Their portfolio has included Wencor Group, a leading aftermarket parts provider eventually sold to Heico, and TransDigm, a major designer of aerospace components. Additionally, their investments in Accelya (airline software) and Aquila Air Capital (leasing) demonstrate a holistic approach to aviation investment, covering everything from parts to software and finance.

This acquisition fits into a broader regional strategy. Over a span of 30 years, Warburg Pincus has invested over $34 billion in more than 270 companies across the Asia-Pacific region. This deep regional footprint suggests that the firm understands the unique regulatory and operational nuances of the Asian market. Ben Zhou, Managing Director and Co-Head of China Private Equity at Warburg Pincus, will be instrumental in steering this new partnership, leveraging the firm’s global network to enhance Topcast’s service capabilities.

The seller, Permira, exits the investment after a six-year holding period. Since acquiring a majority stake in 2019, Permira oversaw significant developments at Topcast, including the acquisition of an MRO service center in Shanghai in 2021 and the expansion of the management team. This period of stewardship helped professionalize the company and prepare it for its next phase of growth under new ownership.

“Asia Pacific is one of the most dynamic and fast-growing civil aviation markets in the world. Topcast has built a strong reputation as a trusted and innovative partner… We look forward to supporting Topcast in deepening its local capabilities, expanding its global Partnerships, and driving its next phase of sustainable growth.”, Ben Zhou, Managing Director, Warburg Pincus.

Strategic Rationale: The MRO Market Boom

The timing of this acquisition aligns with robust growth projections for the Maintenance, Repair, and Overhaul (MRO) sector. Industry data estimates the Asia-Pacific aircraft MRO market to be worth approximately $24 billion in 2025. Projections indicate this figure could grow to between $32 billion and $42 billion by 2030, representing a Compound Annual Growth Rate (CAGR) of roughly 6-7%. This growth is fueled by a massive influx of new aircraft orders and the maintenance requirements of an aging existing fleet.

Supply chain resilience remains a critical theme in the post-pandemic aviation world. Airlines and MRO providers are facing persistent shortages of components, making the role of distributors vital. Companies that can guarantee the availability of parts, from consumables to buyer-furnished equipment (BFE), are essential for keeping aircraft operational. Topcast’s recent expansion of its exclusive distribution partnership with Honeywell in February 2024 to supply Boeing 737 mechanical components in China is a prime example of how distributors are securing their value proposition.

By acquiring Topcast, Warburg Pincus is effectively betting on the longevity of this supply chain demand. The firm intends to use its resources to help Topcast expand its partnerships with global Original Equipment Manufacturers (OEMs). The goal is to enhance digital capabilities and local service delivery, ensuring that Topcast remains the preferred partner for airlines navigating a constrained supply environment.

Competitive Landscape and Future Outlook

Topcast operates in a fragmented but highly competitive market. Its primary advantage lies in its independence. Major competitors often include the distribution arms of airframe manufacturers, such as Boeing Distribution (formerly Aviall) and Satair (an Airbus subsidiary). While these giants have immense scale, they are often tethered to their parent companies’ ecosystems. In contrast, independent distributors like Topcast and the US-based Wencor (now part of Heico) can offer a broader, more neutral range of products.

Regional Dynamics and Challenges

In the Asia-Pacific region, competition also comes from regional players like Aerotechnic Asia and the logistics divisions of large MRO providers such as HAECO and ST Engineering. However, Topcast’s specific focus on distribution and component repair allows it to occupy a specialized niche. The challenge for the company moving forward will be to maintain its agility while scaling up operations to meet the demands of Warburg Pincus’s growth targets.

Orson Lo, the CEO of Topcast, has expressed optimism regarding the transition. The management team views the partnership with Warburg Pincus as a catalyst for further expansion. The focus will likely remain on strengthening the company’s foothold in mainland China while exploring new opportunities in emerging aviation markets within Southeast Asia.

“We are excited to begin this new chapter with Warburg Pincus. Their deep sector experience, global network, localized approach, and growth-oriented philosophy will support our mission to deliver best-in-class service… to the civil aviation industry in Asia Pacific and beyond.”, Orson Lo, CEO, Topcast.

Concluding Section

The acquisition of Topcast by Warburg Pincus represents a calculated consolidation in the Asian aerospace supply chain. By combining Topcast’s established regional dominance with Warburg Pincus’s capital and global aviation expertise, the entity is well-positioned to lead the market through the coming decade of growth. As the Asia-Pacific region continues to drive global aviation statistics, the efficiency and reliability of distributors like Topcast will be paramount to the industry’s success.

Looking ahead, we expect to see Topcast aggressively pursue new OEM partnerships and potentially engage in further M&A activity to consolidate its market position. This deal serves as a strong indicator that private equity retains a high level of confidence in the long-term fundamentals of the commercial aviation sector, particularly in the East.

FAQ

Question: Who acquired Topcast?
Answer: Topcast was acquired by Warburg Pincus, a leading global growth investor, from the private equity firm Permira.

Question: What does Topcast do?
Answer: Topcast is the largest independent distributor of aircraft parts and a provider of MRO (Maintenance, Repair, and Overhaul) services in the Asia-Pacific region.

Question: Why is the Asia-Pacific market significant for this deal?
Answer: The Asia-Pacific MRO market is projected to grow significantly, reaching up to $42 billion by 2030, driven by fleet expansions and increasing air traffic in the region.

Sources

• Warburg Pincus Press Release

Safran Expands Strategic Footprint in India with New Civil and Military Aviation Facilities

On November 26, 2025, the aerospace landscape in India witnessed a significant transformation as Safran, the French multinational aerospace and defense corporation, inaugurated major new facilities in Hyderabad. This expansion marks a decisive step in the company’s long-term strategy to deepen its industrial presence in the region. The events included the inauguration of a massive MRO center for civil engines and the groundbreaking of a dedicated facility for military engine maintenance. These developments underscore a robust alignment with the Indian government’s “Make in India” initiative, aiming to bolster local capabilities in high-technology sectors.

The strategic move involves substantial financial commitment, with investments totaling approximately €240 million across the new projects. By establishing these facilities, Safran is not only enhancing its service delivery to Indian airlines carriers and the Indian Air Force (IAF) but is also positioning India as a critical node in its global supply chain. The initiatives are designed to address the growing demand for aviation services in one of the world’s fastest-growing aviation markets, where domestic carriers have over 1,500 aircraft on order.

Beyond physical infrastructure, the expansion includes significant partnerships intended to transfer technology and foster local manufacturing. A notable highlight is the collaboration with Bharat Electronics Limited (BEL) to produce advanced defense systems locally. These simultaneous developments in civil and defense sectors reflect a comprehensive approach to market penetration, aiming to triple Safran’s revenue in India to over €3 billion by 2030 while significantly increasing local sourcing.

World’s Largest LEAP Engine MRO Center

The centerpiece of this expansion is the inauguration of the Maintenance, Repair, and Overhaul (MRO) center dedicated to the LEAP engine. Located in the GMR Aerospace and Industrial Park in Hyderabad, this facility represents an investment of €200 million (approximately ₹1,300 crore). It is distinguished as the largest MRO center for CFM International LEAP engines globally and the first such facility established by a global original equipment manufacturer (OEM) within India. The center is designed to service LEAP-1A and LEAP-1B engines, which power the Airbus A320neo and Boeing 737 MAX fleets operated by various Indian airlines.

Operational efficiency and capacity are central to the facility’s design. The center is projected to handle 300 engine shop visits annually once it reaches full operational status in 2026. Initially starting with a workforce of 250, the facility plans to scale up its employment to 1,100 highly skilled technicians at full capacity. This large-scale recruitment and training drive is expected to contribute significantly to the local skill ecosystem, creating a pool of specialized aviation maintenance professionals in the region.

The establishment of this facility addresses a critical economic inefficiency in the Indian aviation sector. Currently, approximately 85-90% of MRO work for Indian carriers is outsourced to foreign facilities, leading to substantial foreign exchange outflows. By localizing these services, the new center will aid Indian airlines in reducing turnaround times and operational costs. Civil Aviation Minister K. Rammohan Naidu noted that domestic MRO activities could potentially save the industry up to $15 billion in foreign exchange in the coming years, highlighting the macroeconomic impact of this project.

“I want to thank Prime Minister Narendra Modi and the Indian Government for their support and trust… We’re proud to support the rapid growth of India’s civil and defense aerospace markets and actively contribute to the country’s Make in India policy and strategic autonomy.”, Olivier Andriès, CEO of Safran.

Strengthening Defense Autonomy: M88 Engines and the “Hammer” JV

Parallel to its civil aviation efforts, Safran has broken ground on a new MRO shop dedicated to the M88 engine, which powers the Dassault Rafale fighter jets. Located adjacent to the LEAP facility in Hyderabad, this project involves an investment of €40 million. Notably, this will be the first M88 MRO shop established outside of France. The facility is designed to process 600 engine modules annually and will employ up to 150 technicians. Its primary mandate is to support the Indian Air Force (IAF) fleet, ensuring higher availability and operational readiness for the Rafale jets, while also possessing the capacity to serve other export customers.

In a move to deepen defense localization, Safran also signed a Joint Venture (JV) and Cooperation Agreement with the Indian state-owned Bharat Electronics Limited (BEL). This 50:50 partnership focuses on the manufacturing of the “Hammer” (Highly Agile Modular Munition Extended Range) air-to-surface weapon. The Hammer is a precision-guided munition with a range of up to 70 kilometers. The joint venture aims to manufacture this advanced weaponry locally, thereby reducing reliance on imports and enhancing the strategic autonomy of the Indian defense forces.

The integration capabilities of the Hammer missile extend beyond the Rafale. The weapon system is designed to be compatible with India’s indigenous Tejas Light Combat Aircraft (LCA), providing a significant boost to the operational capabilities of home-grown platforms. This collaboration signifies a shift from a buyer-seller relationship to a co-development and co-production model, aligning with the broader defense strategy of the Indian government to build a self-reliant defense industrial base.

Economic Targets and Future Implications

The aggressive expansion strategy outlined by Safran is backed by specific financial and operational targets. The group aims to triple its annual revenue in India, targeting a figure exceeding €3 billion by the year 2030. To achieve this, the company is not only expanding its own facilities but is also restructuring its supply chain. Safran plans to increase its sourcing of components from Indian suppliers by 500% (a five-fold increase) by 2030, integrating Indian manufacturers more deeply into the global aerospace value chain.

These developments occur against the backdrop of a rapidly expanding Indian MRO market, which is projected to grow from its current levels to approximately $4 billion by 2031. With Indian carriers placing record-breaking orders for new aircraft, the demand for domestic maintenance capabilities is set to surge. Safran’s early positioning in this sector allows it to capture a significant share of this growth while supporting the operational stability of the region’s airlines.

Looking ahead, the company has indicated a willingness to further expand its industrial footprint based on future defense procurement. CEO Olivier Andriès indicated that if India places additional orders for Rafale jets, beyond the initial 36 and the 26 Marine variants, Safran is committed to establishing a Final Assembly Line (FAL) for the engines in India. This potential development suggests that the current investments are part of a phased roadmap that could see India becoming a central hub for advanced aerospace manufacturing in the coming decade.

Conclusion

Safran’s simultaneous inauguration of civil and military facilities in Hyderabad represents a pivotal moment in the Indian aerospace sector. By localizing critical maintenance capabilities for the LEAP and M88 engines and initiating the local production of advanced weaponry through the BEL joint venture, the company is effectively bridging the gap between global technology and local requirements. These steps not only support the operational efficiency of Indian airlines and the Air Force but also generate significant economic value through job creation and foreign exchange savings.

As the Indian aviation market continues its trajectory toward becoming one of the largest in the world, the establishment of such infrastructure is essential for sustainable growth. The commitment to triple revenues and multiply local sourcing suggests that this partnership will continue to evolve, potentially leading to even more advanced manufacturing capabilities, such as engine assembly lines, being established in India in the near future.

FAQ

Question: What is the significance of the new LEAP MRO facility in Hyderabad?
Answer: The new facility is the largest MRO center for CFM International LEAP engines in the world and the first established by a global OEM in India. It will service engines for Airbus A320neo and Boeing 737 MAX aircraft, helping Indian airlines reduce costs and turnaround times.

Question: What is the “Hammer” Joint Venture?
Answer: It is a 50:50 partnership between Safran and Bharat Electronics Limited (BEL) to manufacture the “Hammer” air-to-surface weapon in India. The weapon has a range of 70 km and will be integrated into Rafale and Tejas aircraft.

Question: How does this expansion impact the Indian economy?
Answer: The expansion aims to triple Safran’s revenue in India to over €3 billion by 2030 and increase local sourcing by five times. Additionally, domestic MRO capabilities are expected to save billions in foreign exchange by reducing the outsourcing of maintenance work.

Sources

Safran Group Press Release