BAE Systems North America has announced the completion of its $1.67 billion acquisition of Lockheed Martin Aerospace Electronics Systems (AES).
The acquisition, agreed in July, will make BAE the world’s largest defence contractor based on 1999 revenues and forms part of Lockheed’s attempts to refocus activities and reduce debt. In September, BAE bought Lockheed’s control systems business for $510m.
‘This is a watershed in the evolution of the company,’ said John Weston, BAE Systems’ chief executive. ‘BAE Systems now has a strong presence in the defence industry in the United States – the world’s biggest single defence market.’
AES is recognised as a world leader in the design and production of aircraft self-protection systems and tactical surveillance and intelligence systems for all branches of the US military and US government.
AES has strong market positions in the high technology field of electronic warfare with good positions on many key US defence programmes, including the F-22, F/A-18E/F and the Joint Strike Fighter (JSF).
In addition to growth from programmes moving from development to production, upgrades of existing systems are expected to become an area with substantial growth over the coming years.
In 1999 AES produced profit before interest and tax of $118m on sales of $1,178m and the company employs nearly 5,000 employees across five American states.
‘This acquisition is consistent with BAE Systems’ overall desire to broaden the range of total system solutions we offer to our armed forces and those of allied and friendly nations, as well as our commercial customers,’ said Mark Ronald, president and chief executive of BAE Systems North America.