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Friday, 14 July, 2000, 05:36 GMT 06:36 UK
BAE Systems in 1.1bn Lockheed deal
Hawk jet
The former British Aerospace is already active in the US
UK defence giant BAE Systems has bought Lockheed Martin's aerospace electronics division for 1.1bn ($1.65bn).

The firm, result of the merger of British Aerospace and GEC Marconi, is thought to have outbid other US defence companies, including Northrop Grumman, in an auction process.

Lockheed Martin announced last September it planned to sell some of its non-core businesses, as part of a general reorganisation of the business.

Buying Aerospace Electronics Systems (AES) boosts BAE Systems' presence in the US, where it already employs 18,000 people.

"This acquisition strengthens BAE Systems as a major player in the global defence market," John Weston, BAE chief executive said.

"The AES businesses will complement BAE Systems' established positions in the systems, defence and aerospace markets worldwide," he added.

The Lockheed electronics division produces aircraft self-protection systems, infrared radars and reconnaissance and navigation systems. It employs about 5,300 people.

It generated revenues of $1.2bn in 1999.

The sale had attracted strong interest from buyers across the US, analysts said.

Lockheed's reinvention

Lockheed has previously made clear its intention to sell off non-core assets.

In May, the company sold its control systems business for $510m to BAE Systems. The division makes products such as gears that control aircraft flight and engines.

Lockheed is still looking at other businesses to sell under its divestiture plan.

BAE Systems was formed by the merger of British Aerospace and Marconi Electronic Systems in November 1999.

In June this year, the firm announced 3,800 job cuts in an attempt to drive down costs following the merger.

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15 Jun 00 | Business
Job cuts at defence firm
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