Alvis has conditionally agreed with Rolls-Royce to acquire the business interests of Vickers Defence, comprising Vickers Defence Systems and Vickers Bridging. Both companies are based in the UK. Alvis also has agreed to acquire a 75% stake in Vickers OMC, based in South Africa.
The consideration for the transaction on a debt-free basis will be £16.2m, which is to be funded from Alvis’s existing cash resources and bank facilities.
Vickers Defence’s products include the Challenger II Main Battle Tank, a range of other armoured vehicles and sub-systems, training and simulation, logistics support, proof and experimental ranges and military bridging.
Vickers Defence’s order book amounts to £253m, including an order for Engineer Tank Systems for the UK MoD with an outstanding value of £218m.
The operations of Vickers Defence Systems will be merged with those of Alvis’s existing UK armoured vehicle company, Alvis Vehicles Ltd, in a combined UK business. Vickers Bridging and Vickers OMC will continue as self-standing businesses.
The transaction is subject to Alvis shareholder approval and regulatory approval in the UK and South Africa.