BAE Selected As Supplier for AWD Hull Blocks Contract

(Williamstown, Victoria, June 29, 2009) -- The selection of BAE Systems Australia as the supplier to build hull blocks for the Air Warfare Destroyer (AWD) program reflected the company's shipbuilding experience and capability, Jim McDowell, Managing Director, said today.

Mr McDowell said ASC Pty Ltd had reconsidered BAE Systems Australia's offer in recent weeks and the two companies had negotiated to achieve a positive outcome.

"We always felt that we had submitted a very competitive bid, one that was backed up by our proud naval shipbuilding record, our strong balance sheet, and our highly skilled workforce," Mr McDowell said.

"Now, we are ready to get on with the job. BAE Systems is pleased to be involved in the AWD construction program; on top of contracts we have already secured to supply the maritime satellite communications terminals and Mark 45 deck guns for these warships."

Mr McDowell said that the latest contract would secure work for up to 400 highly skilled BAE Systems employees at its Williamstown shipyard for the next five years.

"This contract creates the critical mass needed to sustain the shipyard for the medium term," he said.

Over the period of the contract, BAE Systems will build a total of 36 blocks for all three destroyers. These blocks comprise the hull machinery compartments, and bow and stern sections of the ships which represent the most complex parts of the hull.

To deliver the program, BAE Systems will upgrade the infrastructure at its Williamstown shipyard. Major elements include the construction of Australia's largest wholly enclosed blast and paint facility, new construction halls and automated fabrication systems. This will create a flow on effect for employment in the Victorian construction industry.

"I am also very grateful to the Victorian Government which is contributing towards the infrastructure upgrade cost for Williamstown," Mr McDowell said.

Source : BAE Systems PLC (LSE: BAES.L) - click here for more information