Brazil buys BAE’s patrol vessels and acquires ship-building IP

Brazil buys BAE’s patrol vessels and acquires ship-building IP

The Brazilian Navy will buy three ocean patrol vessels from BAE Systems, originally built for the Government of Trinidad and Tobago, for £133m.

The contract covers ancillary support services and contains a manufacturing licence to enable further vessels of the same class to be constructed in Brazil.

As part of the contract, BAE Systems will provide a design information package containing the relevant design and manufacturing information for constructing ocean patrol vessels by the Brazilian Navy.

While this will help to support Brazil’s naval re-equipment programme and boost its maritime manufacturing capability, it will likely reduce the potential for more ship building business for BAE Systems to Brazil.

Commissioned in 2007, the Government of Trinidad and Tobago first said it wanted to cancel the contract for the three ships in September 2010.

At the time, while the defence contractor warned that the size of any financial penalty for the cancelled contract could not be “definitively assessed”, it stated that a “charge of up to £150 million, before tax, may be required in the accounts for 2010.”

The sale of these vessels will reduce the balance sheet loss considerably. BAE was unavailable to comment on the final profitability of the patrol vessel contract.

The 90-metre vessels are designed for drug-busting work among other near-shore patrol operations. They will provide the Brazilian Navy with better maritime capability in the near term, pending the acquisition of future ships under PROSUPER – Brazil’s surface ship acquisition programme.

The first two ships will be delivered in 2012 and the third will follow in early 2013.

“This is a significant step forward in our relationship with Brazil. The Ocean Patrol Vessels are highly capable ships and I am sure they will be a tremendous asset to the Brazilian Navy,” said Andrew Davies, Managing Director of BAE Systems’ Maritime business.
He added that BAE Systems hoped this will be the start of a long term partnership with Brazil in the maritime sector.

Rear Admiral Francisco Deiana, the Brazilian Navy’s Director of Naval Engineering, said: “This procurement does not change the scope of our PROSUPER programme for the acquisition of future ships which also includes a further five Ocean Patrol Vessels of c.1,800 tonnes to be constructed in Brazil”

Will Stirling

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