US giants prepare for battle over Alvis

Foreign military vehicle builders are circling Alvis with a view to trumping last week’s £78m bid for the company from GKN. It has emerged that two separate US defence concerns are interested in bidding for Alvis, which agreed to GKN’s bid as part of a merger that will result in the closure of its Coventry […]

Foreign military vehicle builders are circling Alvis with a view to trumping last week’s £78m bid for the company from GKN.

It has emerged that two separate US defence concerns are interested in bidding for Alvis, which agreed to GKN’s bid as part of a merger that will result in the closure of its Coventry factory and hundreds of job losses.

According to reports, General Dynamics is considering making a counter-bid for Alvis and has been discussing proposals with City advisers.

General Dynamics’ product range includes the Abrams tank, a direct rival for Vickers’ Challenger tank for overseas defence orders.

United Defense, the US developer of military vehicles such as the Bradley armoured personnel carrier, is also said to be considering mounting a deal.

Both United and Alvis have worked together in the past. They are also partners in the Marconi-led consortium bidding to build the Anglo-US Tracer, a new type of battlefield reconnaissance vehicle.

Vickers, which shocked the financial markets last week with plans to close one of its UK tank factories and cut 650 jobs, has said it might be interested in getting involved in the GKN/Alvis tie-up possibly by taking a stake in the merged company.

Chairman Sir Colin Chandler said last week that he has ‘not ruled out’ an attempt to participate in the consolidation of the UK’s armoured vehicles industry.

Vickers held talks with GKN last year in a bid to buy GKN Defence, the armoured vehicles business, but these talks came to nothing.

Chandler said he has also examined the possibility of an alliance with Giat of France.