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BOB MOON: A major British defense firm is increasing its presence here in the U.S. BAE Systems is buying the American defense contractor Armor Holdings. Marketplace’s Stephen Beard has more from London.
STEPHEN BEARD: The deal, which is said to be in its final stages, values Armor Holdings at $3.5 billion.
The company supplies among other things special armor for the Humvee.
Business has boomed since the invasion of IRAQ. Armor Holdings’ share price was under $10 in March 2003. Today BAE is offering around $88 a share.
For the British company the acquisition is part of a strategy to play down its origins and turn itself into more of an American corporation. Justin Urquart -Stewart of Seven Investment:
JUSTIN URQUART-STEWART: If you want to be big in the defense industry you’ve got to be big in the United States and the growing defense demand over there with the requirements for the Iraq campaign.
With Armor Holdings, BAE could be well-placed to win contracts when the Army replaces thousands of Humvees and orders a new generation of mine-resistant troop carriers.
In London, this is Stephen Beard for Marketplace.
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