British Aerospace (BAe)is preparing to resume talks with South Africa over its planned acquisition of an equity stake in state-owned defence company Denel. The move follows Pretoria's decision to purchase up to 28 Saab/BAe Gripen fighters and 24 Hawk trainers.
BAe reveals that the signing of the defence contract, and the Gripen purchase in particular, had been a condition for it continuing to discuss investment in Denel. "Our pursuit of the equity stake was contingent on that contract being secured," says BAe, which expects the orders to be formally signed by November.
The UK company plans to buy 20-30% of Denel Aviation (one of four units to be formed after a restructuring), having signed a memorandum of understanding in January this year. "It is unlikely the purchase will go through in 1999 but we may be able to announce an agreement by the end of this year," it adds.
Source: Flight International
