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Marine Log

January 17, 2008

BAE Systems to buy Tenix defense businesses

Tenix --Australia's largest locally-owned defense and technology contractor--has agreed to sell its defense businesses in their entirety to BAE Systems Australia, a subsidiary of BAE Systems Plc (BAES). According to Australia's ABC news, the takeover is an Australian $775 million deal.

The sale is subject to regulatory and other approvals, and is expected to be finalized during the first half of the 2008 calendar year.

Tenix's defense operations include its Marine Division with shipyards in Williamstown (Victoria) and Henderson (Western Australia), while its Whangarei site in New Zealand has fabricated ANZAC superstructure and hull modules and is suitable for small vessel construction.

Last October the Australian Government signed a contract with Tenix, worth about A$3.1 billion (US$2.78 billion) over eight years, two build two large amphibious ships for the Royal Australian Navy. The ships are based on a LHD design from Spain's Navantia and their hulls will be built in Spain, however he construction of the superstructure and the majority of the fitout will occur in Melbourne, with an estimated value of up to A$500 million. The majority of combat system design and integration work will take place in Adelaide.

ABC News quotes BAE Systems Australia chief executive Jim McDowell as saying the purchase would more than double the company's presence in Australia and boost its naval busines

s. "This transaction significantly enhances the depth and breadth of our capabilities in Australia, adds a major naval business to our portfolio and significantly increases our land capability," he said in a statement.

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