To strengthen defense electronics in advanced military industries, the Saudi Military Industries Company (SAMI) has announced the signing of the terms and conditions sheet for the acquisition of the entire shares of Advanced Electronics Company (AEC) during a joint official event between the Kingdom of Saudi Arabia and the United Kingdom held in London in the presence of the chairman of SAMI, Ahmad Al-Khateeb, and the chairman of BAE Systems plc, Roger Carr.
AEC, based in Riyadh, is involved in engineering, development, manufacturing, repair and technical support sectors through defense, IT, ICT, energy, cybersecurity, and advanced technology at the local, regional, and international levels. SAMI’s investment in the AEC comes as a part of SAMI‘s ongoing efforts to increase and strengthen local Saudi military industries in line with the vision of the Kingdom 2030.
“Saudi Military Industries were established three years ago after the announcement of the vision of the Kingdom 2030. Since then, we have made significant progress thanks to the support of our good governance, the sincere efforts of our cadres, and the support of our success partners,” Ahmad Al-Khateeb said.
Al-Khateeb also added: “The agreement signed today marks a milestone in our career and will enable us to intensify our efforts to build a strong, dynamic, and sustainable military industry in Saudi Arabia”.
“Defense electronics is an important component of the defense industry. So, the acquisition of the AEC puts Saudi Military Industries on the map of the global defense industry, supports our ambitions in this sector, and contributes to raising local content and stimulating economic growth in general”, Al-Khateeb stated.
AEC, founded in 1988 under the EOP, was owned by a number of companies, including BAE Systems. For nearly three decades, it has played a leading role in the fields of modern electronics, manufacturing, systems integration, repair and maintenance services, making it one of the region’s leading innovators.
AEC specializes in the design, development, manufacturing, maintenance and repair of many advanced industrial and military electronic systems and equipment such as: electricity and water smart meter systems, security systems for vital infrastructure, industrial control systems, Typhoon’s cockpit systems, jamming systems, targeting F-15 systems, the electronic units of F-16, ground equipment, training systems, simulators for Hawk 165 aircraft, Tornado cockpit systems and many more.
AEC plays a key role in the localization of Saudi military manufacturing, the deployment of smart technologies, and the acceleration of industrial and commercial growth, while maintaining a localization rate of more than 80%, while the company implemented more than 1000 projects with 100% completion, especially it has developed an Aligned Integrated Methodology to implement and manage projects, programs, and portfolios.
In the past few years, AEC has witnessed steady growth in its sales year on year, with net sales in 2018 rising to SAR2.07bn, compared to SAR1.925bn in 2017 and SAR1.65bn in 2016.
After completion of the acquisition, AEC will be the main structure of SAMI‘s defense electronics unit. The equipment for this unit will be compatible across all its sectors with the OEMs’ products. SAMI‘s total number of employees will increase significantly to reach 2200 as a result of the acquisition.
In addition to facilitating technology transfer, enhancing local production, and deepening MRO operations, the acquisition will enable SAMI to develop its own mature products to help achieve its 2030 strategic objectives.
Since its launch in mid-2017, SAMI has been leading Saudi Arabia’s efforts to develop its defense capabilities and enhance its self-sufficiency through its growing portfolio of military products and services in its four key areas—air systems, ground systems, weapons and missiles.