BAE North America Is Big and Getting Bigger

Paris Air Show » 2005
December 12, 2006, 8:56 AM

BAE already derives 34 percent of its revenues from North America, where 27,000 employees produce an annual turnover of $5.6 billion. Of equal significance, the return on sales is 8.4 percent–the highest figure in all of BAE. The group’s CEO, Mike Turner, is fond of reminding UK and European government officials that the conditions for technology investment are so much more favorable to BAE on the other side of the Atlantic.

In the last fiscal year alone, BAE bought five U.S. companies worth $710 million. The earlier acquisitions have made BAE North America a major force in electronic warfare, communications and information systems. It is already one of the top 10 suppliers to the U.S. military. This year, the Pentagon will become BAE’s biggest customer worldwide, thanks to its $2.2 billion takeover of United Defense Industries, the major U.S. manufacturer of armored vehicles.

To comply with U.S. security regulations, the North American business operates as a separate entity, led by U.S. citizen Mark Ronald as president and CEO. BAE’s British management, including Turner, are excluded from decisions involving some highly classified U.S. defense and security programs conducted on a NOFORN (no foreigner) basis.   

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