Raytheon has completed its acquisition of BBN Technologies, a provider of high-tech defense products, for approximately $350 million, subject to post-closing adjustments.

BBN’s defense portfolio includes advanced networking, speech and language technologies, information technologies, sensor systems, and cybersecurity products. BBN has won numerous contracts from the US Defense Advanced Research Projects Agency (DARPA) to supply advanced technologies for the military…

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Sachsen, sending SM-2
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ThyseenKrupp Marine Systems (TKMS) recently announced a “close strategic partnership” and Memorandum of Understanding with the Abu Dhabi MAR group in the United Arab Emirates, but the move is much closer to a sale of key assets. The MoU stipulates a 50/50 joint venture to build naval surface ships, with TKMS retaining a lead role and know-how in all projects with the German Navy and NATO partners. Similarly, Abu Dhabi MAR Group will be responsible for the Middle East and North Africa. At the same time, however, Abu Dhabi MAR is acquiring 80% of TKMS’ key surface ship firms: Blohm + Voss Shipyards, Blohm + Voss Repair, and Blohm + Voss Industries.

The proposed sale follows other recent purchases in Germany by Abu Dhabi MAR, and other recent shipyard sales by TKMS. The net effect is a restructuring of Germany’s naval shipbuilding industry…

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RG-33 variant
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The USA’s Mine-Resistant, Ambush Protected (MRAP) program has been a long road for BAE Systems. In the wake of the US Army’s belated realization that mine protection was critical for vehicles in theater, BAE’s designs, long-standing experience in the field, and production capacity had made them an early favorite. Early results were a deeply humbling experience for the firm, but a combination of acquisitions, persistence, and product evelopment combined to recover 2nd place status by the time MRAP orders ceased.

This in-depth, updated DID feature shines a spotlight on BAE Systems’ family of MRAP offerings, order record, and associated contracts. The MRAP program appears to have reached its vehicle limit, but some BAE vehicles are getting a major suspension upgrade and maintenance contracts continue…

• BAE MRAP: The Vehicles
• BAE MRAP: The Current Tally
• BAE MRAP: Contracts & Key Events [updated]
• Appendix A: MRAP Competition Half-Time Update, June 28/07
  
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Emerging clusters, 2005
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Russia’s aircraft industry remains one of the country’s defense export standbys, and Russian companies are beginning to partner with foreign firms in ways that could increase their reach. In December 2005, Moscow Defense Brief took a look at key trends, especially the consolidation trends as private maneuverings and state ‘encouragement’ to join a “Unified Aircraft-Building Corporation” (UABC) began to consolidate the various players.

At the time, names like Mikoyan, Sukhoi, Antonov, Ilyushin, Yakolev et. al. appeared to be coalescing around Irkut Corporation, with a second smaller pole around Sukhoi. Recent events are shifting away a French “sesquipolar” model, and toward a unipolar model. The question is whether this will result in success and profitability for a Russian defense industry that is struggling to regain its footing. Recent announcements at the MAKS 2009 indicate that more financial aid is on the way, but the powers that be are less than happy…

• Makienko’s 2005 Analysis
• Key Events & Developments
• Additional Readings
  
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Elbit Systems in Haifa, Israel, agreed to pay $34 million to acquire BVR Systems (1998) Ltd., a provider of training, simulation and debriefing systems for air, sea and ground forces. The transaction is subject to price adjustment as well as fulfillment of certain conditions, including receipt of all approvals required by law. The transaction will also include the re-employment of BVR’s employees by Elbit.

The merger affects, and is affected by, BVR’s recent debt financing agreement. BVR provides a range of services to militaries around the world…

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Canberra concept
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In May of 2006, “Australia Issues Official Tender for A$ 2.0B Large Amphibious Ships Program” covered the RAN’s decision to expand its naval expeditionary capabilities. HMAS Manoora and Kanimbla would be replaced with substantially larger and more capable modern designs, featuring strong air support. Navantia and Tenix offered a 27,000t LHD design that resembled the Strategic Projection Ship (Buque de Proyeccion Estrategica) under construction for the Spanish Navy. The DCNS-Thales Australia team, meanwhile, proposed a variation of the 21,300t Mistral Class that is serving successfully with the French Navy.

Navantia’s larger design eventually won, giving the Spanish firm an A$11 billion clean sweep of Australia’s “Air Warfare Destroyer” and LHD programs. These 5 ships will be the core of Australia’s future surface navy. The LHDs will be able to serve as amphibious landing ships, helicopter carriers, floating HQs and medical facilities for humanitarian assistance, and launching pads for UAVs or even short/vertical takeoff fighters.

The latest inclusion involves a successful early-stage design review…

• Winner: The Navantia-Tenix LHD
• Construction and Program
• Contracts and Key Events [updated]
• Additional Readings
  
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Elbit Systems in Haifa, Israel, has agreed to pay $18 million for a 19% stake in fellow Israeli defense firm Mikal. The Mikal group operates through 3 main divisions: Soltam Systems, which supplies artillery, mortars, and ammunition; Symar, which supplies armored fighting vehicles; and ITL Optronics, which supplies sensors for soldiers, unmanned aerial vehicles, military vehicles and battle management systems.

In the first stage of the transaction, Elbit Systems will loan Mikal $18 million. Once regulatory approvals are received, the loan will be converted to an equity investment, and Mikal will issue approximately 19% of its shares to Elbit Systems. Then, Elbit Systems will be granted the option to purchase the remaining shares of Mikal from the other shareholders during 2011 for a purchase price to be determined through an independent external valuation. The Mikal Group is Israel’s second largest privately owned defense conglomerate, consisting of 19 globally-distributed companies focusing on land-based solutions, systems and products for over 80 countries worldwide.

Silver Fox in Iraq
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BAE Systems recently completed its $14.7 million acquisition of Advanced Ceramics Research, a Tucson, AZ-based maker of small unmanned aerial vehicles (UAVs) and ceramic materials for military and commercial application. The initial agreement was originally announced on March 12/09; this latest step represents its finalization and approval. The company will now become part of BAE Systems, Inc., headquartered in Rockville, MD.

Advanced Ceramics Research manufactures 3 UAV platforms, and provides related support capabilities to the U.S. armed forces and civilian government agencies:

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General Dynamics has agreed to pay $643 million to acquire Axsys Technologies, the world’s leading diamond turning optical manufacturer and a supplier of electro-optical and infrared (EO/IR) sensors and stabilized cameras to the U.S. military and homeland security agencies. General Dynamics Advanced Information Systems will pay $54 per share for Axsys’ outstanding common stock.

According to a General Dynamics spokeswoman, Axsys supplies electro-optical cameras, infared sensors, and multi-axis stabilized sensors for the following U.S. military systems:

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Atlas Elektronik’s UK ubsidiary has reached an agreement to buy QinetiQ (pron. “kinetic”) Group plc’s underwater systems business based in Winfrith, Dorset, for a cash consideration of GBP 23.5m (EUR 26.5/ $40.2 million equivalent). That business has about 220 employees, and operates in the areas of hydro-acoustics, sonar, open architecture sonar and combat management systems, acoustic counter measures, submarine signatures, maritime security and control of unmanned maritime vehicles. Anthem Corporate Finance acted as Atlas’ sole financial adviser.

The parent firm Atlas Elektronik GmbH is now jointly owned by ThyssenKrupp and EADS. QinetiQ is a privatized government defense research organization, and regulatory approval is a normal requirement in these cases. In this case, it may be accompanied by debates about national industrial capabilities, per Britain’s still in draft Defence Industrial Strategy. The firms in question say that approvals are expected to finish in summer 2009.

See also initial release: Atlas Elektronik | QinetiQ.