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Aveos Fleet Performance closes plants, lays off hundreds of workers

Aveos Fleet Performance Inc., which conducts airplane repairs for Air Canada, is shutting down operations in Winnipeg, Vancouver and Montreal, leading to hundreds of Aveos job losses.

Peter Power/The Globe and Mail/Peter Power/The Globe and Mail

Aveos Fleet Performance Inc., which does aircraft repairs for Air Canada, is getting out of the heavy maintenance business in a move that will result in hundreds of layoffs, says a union leader.

Aveos, formerly called Air Canada Technical Services, plans to shut airframe maintenance operations in Winnipeg, Vancouver and Montreal, according to the International Association of Machinists and Aerospace Workers.

Lorne Hammerberg, the Winnipeg-based president of Local 714 of the union, said workers were shocked to learn about the company's shutdown notice issued on Sunday.

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An employee in Montreal added that Aveos asked employees on the Sunday shift to leave the Quebec plant and contact the company later for further details.

Air Canada spokesman Peter Fitzpatrick said the carrier will be able to secure the services of other suppliers for aircraft maintenance, repair and overhaul, or MRO.

"While the bulk of Air Canada's scheduled heavy maintenance is done by Aveos, we have always obtained additional services from other MRO providers, through a joint process that has always involved the IAMAW's participation and knowledge," he said in a statement Sunday night. "Aveos has been a separate company from Air Canada since 2004."

Last year, the IAMAW warned that the jobs of nearly 1,000 of the Aveos workers at the Montreal plant could vanish, plus roughly another 300 employees were at risk in Winnipeg and at least 250 staff at the Vancouver operations.

ACE Aviation Holdings Inc., created after Air Canada emerged from bankruptcy protection in 2004, unloaded a 70-per-cent stake in the repair firm for $723-million at the height of the leveraged buyout boom in 2007.

ACE later wrote off its remaining minority investment in Aveos, as did two buyout specialists – New York-based Kohlberg Kravis Roberts & Co. and Sageview Capital LLC of Greenwich, Conn., founded by two former KKR partners.

In 2010, a group of lenders took majority control of Aveos, converting debt into equity in a deal that cast aside the two U.S.-based private equity firms.

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About the Author

Brent Jang is a business reporter in The Globe and Mail’s Vancouver bureau. He joined the Globe in 1995. His former positions include transportation reporter in Toronto, energy correspondent in Calgary and Western columnist for Report on Business. He holds a Bachelor of Commerce degree from the University of Alberta, where he served as Editor-in-Chief of The Gateway student newspaper. Mr. More

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