Aerospace company Vought Aircraft Industries Inc. navigated recessions, a fierce slump in plane sales and near-catastrophic delays to a major platform. But in the end, Vought's loyal sponsor, Carlyle Group, still made an estimated 240% gain when it sold Vought to Triumph Group Inc. in March.

Washington's Carlyle has had a long and fruitful history with Vought. It first joined with Northrop Corp. to buy the supplier, one of the oldest names in aviation, back in 1992. Northrop bought out Carlyle in 1994, then turned around and sold the company back to Carlyle in 2000 as part of a broader consolidation in aerospace.

Carlyle's repurchase came just before a bleak period of retrenchment in commercial aviation that slowed sales of the new jets that Vought made components for. Carlyle in 2003 merged Vought, which makes systems for Boeing Co. jets, with another portfolio company, Aerostructures Corp., a vendor to Boeing rival Airbus SAS. That move came amid a restructuring of the business designed to right-size its manufacturing footprint and boost its chances to attract new work.

Adam Palmer, a Carlyle managing director, says Vought and Aerostructures were combined on the premise that "a broader program base and a deeper engineering capability would better position the company to win new business." In previous decades rivalries among major suppliers to Boeing prevented them from working with Airbus, and vice versa, but the manufacturers are beginning to understand the benefit of having diverse suppliers.

That diversity was much needed. Vought was almost derailed by troubles stemming from its involvement in Boeing's much-celebrated 787 Dreamliner platform. When Dreamliner development fell behind schedule in 2007, many fingers were pointed in the direction of Vought's North Charleston, S.C., facility, where the plane's fuselage was to be assembled.

By 2008 it was clear that problems meeting Boeing's ambitious production schedule went well beyond Vought, and the impact of the delays were felt throughout the supply chain. Vought invested more than $500 million in the North Charleston plant and accepted more than $400 million in advanced payments from Boeing to keep the operation humming, according to reports at the time.

Some aerospace analysts worried that Vought did not have the capital to survive into 2010, when Boeing hoped to begin deliveries and payments would begin flowing back to suppliers.

In July 2009, Boeing agreed to acquire Vought's 787 business for $580 million in cash and the forgiveness of those advanced payments. Vought CEO Elmer Doty in a statement said "the financial demands of this program are clearly growing beyond what a company our size can support," pledging to focus the company's attention on its other businesses including its roles on Airbus planes and Boeing's 737, 747, 767 and 777 passenger jets.

Fortunately for Carlyle and Vought, that business was thriving even as the 787 program struggled. Vought's remaining programs benefited from the company's post-Sept. 11 cost-cutting regime, generating strong positive cash flow.

By the time Carlyle sold Vought to Triumph for $1.44 billion in cash, stock and assumed debt, the company was generating $1.9 billion in annual sales from making fuselages, wings and cabins for a variety of commercial, military and business aircraft.

Carlyle received about $512 million in cash and 7.3 million Triumph shares worth $518 million at current market prices. The firm declined to comment on its returns, but an analysis of financial filings indicate the sale represents a gain of 240% for Carlyle, which invested about $175 million in equity in Vought and a further $105 million in Aerostructures.

Historically, Triumph Group had been focused on second-tier manufacturing and repairing aircraft components, but it sought an opportunity to quickly move upstream and become a tier-one supplier. Triumph chief executive Richard C. Ill found it in Vought, saying in a statement that the deal "will dramatically advance our technical capabilities and significantly enhance our ability to offer aerostructure systems solutions to our customers."

Now that it is part of a larger organization with access to public markets and growth opportunities, Vought could conceivably be better prepared to take a role when the next new program like the Dreamliner comes around. If it does, Carlyle, which retains a stake in Triumph, might yet enjoy considerable upside.

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