BAE wins multi-billion pound Australian warship contract

BAE, which has a site in Telford, will build nine Type 26 submarine hunter ships for the Royal Australian Navy under the terms of a 30-year contract.

It will not impact on the armoured vehicle maintenance division in Hadley Park, which employs about 300 people.

The group saw off competition from Spain's Navantia and Italian firm Fincantieri to win the deal, which is part of a 200 billion Australian dollar spending programme by Canberra.

UK ministers have hailed the decision as a coup for Brexit Britain, although the ships will be built in Australia.

It will come as welcome relief to Theresa May, who has had to deal recently with a public hammering from Airbus, BMW and business groups over her party's handling of Brexit.

BAE Systems chief executive Charles Woodburn said the selection of the company as preferred tenderer reinforced its position as a "leading designer and builder of complex maritime platforms".

"I am proud that our world-class anti-submarine warfare design and our approach to transferring technology and skills to the nations in which we work is expected to contribute to the development of an enduring world-class naval shipbuilding industry in Australia," he said.

Shares in BAE were up over one per cent following the news.

The deal is the second major coup for BAE after the defence giant bagged a £150 million tank contract with the US Marine Corps last week.

The deal will see BAE deliver an initial 30 "amphibious combat vehicles" with options for a total of 204 tanks, which could be worth up to £909 million.

Earlier this year, it was announced that the UK Government will stump up £900 million for BAE to press ahead with the second phase of construction for four nuclear-armed Dreadnought submarines.