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Britain’s biggest weapons manufacturer, BAE Systems, has announced its plans to acquire US space technology company Ball Aerospace for .6bn (£4.4bn) in one of the largest takeovers by a UK company this year. The FTSE 100 defence company aims to expand its presence in technologies that are considered US defence priorities by purchasing the Colorado-based business.

This acquisition is occurring at a time when global spending on military and spying technology is increasing due to Russia’s invasion of Ukraine and the US’s efforts to keep up with China’s advancements in space technology. Ball Aerospace, a subsidiary of Ball Corporation, primarily focuses on instruments, sensors, and spacecraft technologies. They specialize in sensitive satellite technologies, including laser communication systems and satellite tracking systems. The company’s defence technologies have applications ranging from linking infantry and drones via satellite to monitoring potential threats from other vehicles in space.

BAE Systems, with a valuation of over £30bn, is the largest defence company in the UK. They manufacture a wide range of weapons, from tanks to fighter jets, as well as the UK’s Vanguard submarines carrying Trident nuclear missiles. BAE expressed confidence in the growth potential of the deal, citing alignment with the US intelligence community and the highest priorities of the US Department of Defense. Over 60% of Ball Aerospace’s 5,200 employees hold US security clearances, enabling them to work on sensitive military technologies.

BAE Systems CEO, Charles Woodburn, stated that this acquisition would add a high-quality business with significant capabilities to their core operations. The deal is expected to bring about m of cost savings through joint procurement and improved project management. However, there was no mention of potential job cuts. The transaction is anticipated to be completed in early 2023.

While big UK mergers and acquisitions have slowed down in recent years, there have been a few notable deals, including Vodafone’s £15bn merger with Three’s UK telecoms operations and Sweden’s EQT acquiring veterinary pharma company Dechra for £4.5bn.

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