BAE cuts Saab stake after Gripen revamp

BAE Systems is to sell close to half its stake in Saab, the Swedish aerospace and defence electronics group, after announcing changes to its Gripen fighter jet joint venture.

BAE Systems is to sell close to half its stake in Saab, the Swedish aerospace and defence electronics group, after announcing changes to its Gripen fighter jet joint venture.

BAE is to allow the Swedish group to handle the marketing and assume full responsibility for export orders for the Gripen aircraft, which is sold as an alternative to Lockheed Martin's ubiquitous F16 fighter.

With Saab taking greater control of the Gripen project, BAE has decided to sell down its stake in Saab from 35 per cent of the company to 20 per cent in a move expected to raise about £140m. The shares will be placed on the Swedish stock market in January.

Gripen, which means Griffin in Swedish, has won orders from South Africa, Hungary and the Czech Republic. It is marketed as a cheaper and more cost effective alternative to the F16. The joint venture to develop export sales of the aircraft between BAE and Saab was signed in 1995 and has received support from the Swedish government.

Ake Svensson, Saab's chief executive, said: "The relationship with BAE has now firmly established Gripen in the export market and for Saab this is a logical step forward."

The Gripen replaced the Viggen, which means thunderbolt, which the Swedes sold in the 1970s and 1980s. The Viggen was a large fighter, reconnaissance and strike aircraft that itself replaced the Draken (Dragon) of the 1950s and 1960s. The Gripen has secured 56 orders since the mid-1990s.

Mike Turner, the chief executive of BAE, said: "BAE Systems remains fully committed to all existing Gripen contracts and will, on a case-by-case basis, also directly support new marketing efforts."

Although Saab still makes aircraft, it sold its famous car marque to General Motors.