AAR Corp said it would sell its cargo handling business, Telair Cargo Group, to TransDigm Group Inc for $725 million in cash to focus on its aviation services business. AAR, which provides services to U.S. government and commercial clients, also said on Monday that it intended to sell its unprofitable precision systems manufacturing business. The company warned that results in the quarter ending Feb. 28 would be less than expected due to costs associated with the sale of Telair and with bids for large government contracts as well as fewer flying positions in its airlift operations. AAR said the quarter would include an impairment charge of about $40 million related to the discontinuation of the precision systems business. A fall in sales to defense customers led to AAR posting lower revenue in the year ended May 31, the first decline in four years. The company's revenue has missed market estimates for four of the past six quarter. Citi is AAR's financial adviser and Winston & Strawn LLP is its legal adviser. They will also serve as advisers on the sale of the precision systems manufacturing business. (Reuters)