Aerospace & Defence
Our international aerospace and defence experts have worked on the financing and restructuring of some of the world's largest defence programmes. We advise governments, financiers, as well as aerospace, naval and land-systems defence contractors on the broadest range of transactions.
Restructuring and consolidation, international co-operation, and increased pressure on defence budgets have come to provide a backdrop to growing concerns about national security. Defence budgets have come under particular pressure compared with other areas of public expenditure. Governments are looking at alternative methods of financing defence projects, which has led to a greater focus on improving the efficient use of defence assets.
Our experience covers PFI/PPP and other private financings, partnering, procurement, outsourcing, M&A and joint ventures. We also advise on EU and competition, dispute resolution, intellectual property, construction, real estate, tax and environmental issues within the aerospace and defence industry.
- advising GKN on the sale of its 50% stake in AugustaWestland to Finmeccanica.
- advising Bazan (now known as IZAR), one of the world's largest ship-building groups, in the final stages of the frigates programme in relation to its agreements with Norwegian subcontractors.
- advising Barclays Capital and the UK Government's Export Credits Guarantee Department (ECGD) on a highly innovative and groundbreaking US$2.6bn structured export facility for the Republic of South Africa. The facility was put in place to finance South Africa's purchase of 24 Hawk 100 lead-in fighter trainers and 28 Gripen advanced light fighters from leading defence contractor, BAE Systems. This transaction was one of Euromoney Trade Finance's "Deals of the Year", quoted as "excelling with complexities".
- advising global defence company General Dynamics on a technology protection agreement with German defence systems contractor Krauss-Maffei Wegmann (KMW), in relation to the Leopard II tank program. The deal had a value of €1.8bn.
- advising INSA, the engineering and aerospace subsidiary of INTA (National Institute of Aerospace Technology), on a joint venture agreement to provide the Spanish Ministry of Defence and other governmental organisations with satellite communications capacity for a value of €360m.
International aerospace group
- advising the French based new technologies division of an international aerospace group on employee shareholding and saving schemes, with particular focus on cross-border issues.
Netherlands aircraft industry
- advising the Netherlands aircraft industry on the finance transaction with the Netherlands Government relating to the Joint Strike Fighter project.
- advising Sagem, the third largest European manufacturer of electronics for defence and security on the acquisition of Swiss defence optronics company Leica Vectronix and its US-based sales company Leica Technologies Inc from Leica Geosystems. Simmons & Simmons offices in France, Germany and the US all assisted on the transaction.
UK Ministry of Defence
advising the UK Ministry of Defence on:
- the UK Military Flying Training System Project intended to overhaul the whole of the Ministry of Defence's current flying training arrangements for the Royal Air Force, Royal Navy and Army Air Corps.
- the Future Defence Supply Chain initiative (FDSCi) project, a proposed PPP partnering arrangement to plan and deliver an integrated efficient end-to-end supply chain to support the UK Armed Forces.
- the Strategic Sealift (RORO) project (capital value approx. £950m), for the provision of a fleet of six roll-on-roll-off ferries for military transport. This project will involve the first use of lease finance in relation to maritime defence assets. This project won publicprivatefinance Awards Best MoD Project 2003.
- the public-private partnership for the Defence Evaluation and Research Agency (DERA). This involved the division of DERA into QinetiQ Plc and the Defence Science & Technology Laboratory, the sale of a strategic 37.5% stake in QinetiQ to the Carlyle Group, and a long-term (25-year) partnering agreement between the MoD and QinetiQ under which QinetiQ will provide testing and evaluation services at various MoD military ranges and aerodromes. This is one of the first examples where external finance has been raised in relation to a strategic partnering contract. Simmons & Simmons won The Lawyer's 'Projects/PFI Team of the Year' 2003 award for its work on this project.
- the Warship Support Modernisation Initiative (WSMI) entered into with Devonport Royal Dockyard Limited, the privatised dockyard entity located at the Royal Navy Base at Plymouth. The deal utilised a partnering agreement arrangement whereby certain ship maintenance and engineering tasks and other logistics services, which were retained by the Royal Navy post privatisation of the dockyard, will be contracted out to Devonport Royal Dockyard Limited.
- the Future Strategic Tanker Aircraft (FSTA) project, the largest UK PFI defence project to date. The project will replace the RAF's fleet of aircraft providing air-to-air refuelling and transport capability (capital value approximately £2.5bn).
- the Short Term Strategic Airlift Programme (STSA) project, involving the lease finance (as an asset backed bond) for four C-17A Globemaster Aircraft (capital value approx. US$860m) The STSA project was awarded the "Minister (DP) Smart Acquisition Award" by Baroness Symons and was also awarded the XB Team Excellence Award.
- seven flight simulator PFI projects sponsored by the Defence Procurement Agency - MSHATF, Sentry, Lynx, Tornado, Attack, Hawk and FIASTS.
- assisting Urenco Aerospace, a product division of Urenco Nederland, on various licensing and manufacturing agreements with Honeywell, Inc. Urenco Aerospace designs, engineers and manufactures high-technology products for the aerospace industry.