Defence Support Group prepares to be bought privately

Fri, 16 Sep 2011

The Government-owned Defence Support Group (DSG) is getting ready to be taken private, with three defence contractors having made approaches in anticipation.

Babcock, BAE Systems and US arms manufacturer General Dynamics were named as potential buyers by defence minister Peter Luff in a letter to parliament.

“We have received some early and speculative approaches from a number of companies, including BAE Systems, Babcock and General Dynamics,” he wrote.

Babcock and BAE have already held informal talks with Ministry of Defence (MoD) officials. The MoD, however, was not ready yet to accept formal expressions of interest in the business, Luff continued.

DSG - which carries out maintenance repairs of various military equipment include small arms, large aircraft and armoured fighting vehicles for the British armed forces – was scheduled to be privatised in the strategic defence and security review last year.

The Government plans to generate more than £500 million from the sale of several defence assets including DSG, the defence stake in the telecommunications arena, and the Marchwood Sea Mounting Centre, during the Spending Review period.

Operating from 12 bases, DSG employs 3,000 people and brings in about £200 million in yearly revenues.

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