Babcock and UGL win Australian ship deal

March 9, 2012 at 6:30 AM
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CANBERRA, Australia, March 9 (UPI) -- Babcock will enter the ship support market in Australia when the contract for Anzac ship maintenance is finalized at the end of June.

The British company's Australian division teamed with UGL Infrastructure to form the joint venture Naval Ship Management Australia to become preferred bidder for the deal to maintain the eight Anzac-class frigates.

Apart from NSMA, three other companies or joint ventures -- BAE Systems, Thales Australia and DMS Maritime with Transfield Services -- were short-listed for the work.

The five-year Ministry of Defense deal is expected to be worth around $300 million, a statement by Babcock in Australia said. The contract has an option to extend it for another five years and will become operational Jan. 1, 2013.

The Babcock and UGL win is a move away from individual maintenance activities being contracted individually to a panel of companies who compete for the work.

"We are delighted to have won this contract with our partners UGL," Babcock Chief Executive Officer Peter Rogers said.

"We look forward to working with the Australian government and developing a long-term relationship as we support its plans to deliver a new, cost-efficient, integrated naval support solution."

Babcock's Australian defense engineering support business has been going for 20 years, operating in the design, supply and support of naval systems.

Australian markets include submarine weapons handling and launch systems and torpedo discharge systems.

Babcock Australia employs around 70 people and has headquarters in Osborne, a suburb of the port city Adelaide, capital of South Australia state.

Babcock and UGL also have been selected to tender for the Amphibious and Afloat Support Ships' group maintenance contract when it is released, likely by mid 2013.

UGL, formerly called United Group Limited, is an Australian global engineering and property services company based in Sydney but founded in Perth, Western Australia, in the 1960s.

It offers infrastructure engineering design and maintenance, including for shipping and rail, as well as construction management and property facilities management.

In December UGL extended its global reach with the purchase from the administrators of financially beleaguered property developer and management business DTZ.

The acquisition of DTZ enhanced UGL's geographic footprint across Asia, the UK, Europe, Middle East and the Americas.

"The combination of UGL Services and DTZ will have annual revenues of (US$2 billion)," a UGL statement said in December. The deal makes UGL Services one of the largest participants in the global property services sector, the statement said.

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