Babcock: Share price for British defence giant up as it pens £750m submarine deal
British defence giant Babcock has signed a four-year deal worth £750 to build and maintain UK submarines.
The agreement, inked with the Ministry of Defence’s Submarine Delivery Agency, will see the international group dive into supporting and sustaining the UK’s underwater arsenal.
Babcock shares popped by almost three per cent on Friday afternoon following the news.
At the Devonport site, Babcock will upgrade existing infrastructure as it looks to buoy the Royal Navy’s future capabilities and the UK’s.
The major overhaul includes a dock, logistics hub, and modern support facilities.
Defence secretary, Grant Shapps, said: “Maintaining the infrastructure that supports our world-leading submarine fleet is crucial.
“Delivering on our government’s priority to grow the UK economy, this significant investment will create and sustain more than a thousand UK jobs in the south-west, providing vital improvements to the dockyard that will be critical to ensuring our Royal Navy can continue to protect the UK and our Allies.”
On Monday Shapps called insurance giant Aviva “immoral” after it said it was divesting from defence companies not meeting internal policy benchmarks.
Babcock chief David Lockwood said: “The construction programme is one of the largest of its kind and highlights the MOD’s investment being made at the Devonport site, the skills and capability this brings to the city and region, and the ongoing commitment to protect our nation.”
The infrastructure programme will create 1,000 new construction roles as it escalates next year.