Vosper bids for Swan Hunter frigate work: Warship yard's profits up 19% with pounds 700m order book

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The Independent Online
VOSPER Thornycroft, the Southampton-based warship builder, is bidding to take over the construction of three Royal Navy frigates from the closure-threatened Swan Hunter yard on Tyneside.

News of Vosper's interest in the contract came as the company announced a 19 per cent increase in pre- tax profits last year to pounds 19m, a 21 per cent rise in the dividend and a pounds 700m order book.

Peter Usher, chairman, said that although Vosper's workload was enough to keep the yard and its workforce of 2,000 busy for four years he was unhappy that 95 per cent of the orders were for export.

In an attempt to reduce its dependence on overseas customers, Vosper is seeking to raise the proportion of Royal Navy orders to 20 per cent.

The yard is preparing to bid for a further batch of Sandown class minehunters, due to be put out for tender by the Ministry of Defence before the summer recess, and is bidding to become Britain's industrial partner in the future frigate project - a pan-European programme that could involve the construction of up to 12 boats.

But Vosper would also be interested in taking over the fitting out of the three Type 23 frigates being built on Tyneside should the MoD decide to transfer the work from Swan Hunter, which called in the receivers last month.

'We would wish to bid for any contract that is suitable for us,' Martin Jay, Vosper's managing director, said.

Vosper's order book is dominated by a series of contracts for the Middle East. The yard is building two 1,400- tonne corvettes for Oman and four heavily-armed strike craft for Qatar and is confident that the Saudis will confirm orders for a further three minehunters under the Al Yamamah programme.

It is also bidding for minehunter orders from Australia and Turkey, both of which need six vessels. They would be built under licence by joint venture companies in Australia and Turkey.

But Mr Usher said that to sustain its position as Britain's leading builder of warships for export Vosper had to remain a significant supplier to the Royal Navy.

Vosper, he said, was also continuing to broaden its base in the event that there was a lull in warship orders. The company has recently bought a small technical documentation company, TPMS, and an American manufacturer of ship stabilisers and is planning to use its pounds 90m cash pile to finance other acquisitions in the fields of marine equipment, electronic controls and documentation.

Meanwhile the row rumbled on over how Swan Hunter came to lose a crucial order for a Royal Navy helicopter carrier after the rival consortium of VSEL and Kvaerner Govan underbid it by more than pounds 50m.

Stephen Byers, Labour MP for Wallsend, yesterday wrote to the National Audit Office, which is carrying out an inquiry into the affair, urging it to investigate how VSEL escaped paying the Government pounds 40m for its purchase of the Cammell Laird yard on Merseyside in 1986.

Mr Byers said that VSEL would have been liable to make the payment on the basis of subsequent profits but it had managed to reduce these by setting aside pounds 125m in extraordinary restructuring costs. The NAO investigation should examine the extent to which VSEL's bid for the helicopter carrier had been subsidised by the non-payment of the pounds 40m.

(Photograph omitted)

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