Less than four months after the completion of a five-year £83m transformation BAE Systems is selling its Cheshire munitions factory.
Commercial property consultants GVA says it has already received “considerable” interest from British and overseas investors considering the purchase of Radway Green Small Arms Ammunition facility. The guide price is £49.7m.
In June the multinational defence, security and aerospace contractor announced the end of a five-year upgrade programme for the Radway Green plant that effectively reduced its carbon footprint by 50 per cent while increasing capacity by the same amount.
Part of a £200m upgrade to all three of BAE’s Second World War vintage munitions plants — the other two are at Birtley in County Durham and Glascoed in South Wales — the improvements came on the back of a 2008 deal with the Ministry of Defence (MoD) to supply ammunition to British troops.
Since the signing of the £2bn contract, the MoD has suffered massive cuts to its budgets and the UK is about to withdraw from Afghanistan. One reason, analysts believe, for the off-loading of the Radway Green plant.
“The reduced spending within the MoD has affected us, but it has also given us a big opportunity,” admitted Nigel MacVean, BAE’s general manager at Radley, and whose plant is producing 230m rounds of ammunition a year.
“A couple of years ago we only had one export customer. We were comfortable supplying to the MoD, but that has change and we’ve already had some great successes.”
The Radway Green site is also looking at the possibility of expanding its component sales business, with five-million 5.56mm cases delivered to aviation specialist RUAG of Switzerland so far this year.
“The ‘RG’ stamp is synonymous with quality and thanks to the reinvestment programme we can now design, manufacture and test our products all on the same site,” added MacVean. “We are also the European Centre of Excellence for bulk ammunition production.”
About 80 per cent of the two main types of ammunition produced at Radway Green — 7.62mm and 5.56mm — are blanks, mainly for use in military training, although the factory does have a wide range of other customers — including supplying blanks for the last James Bond movie.
Bullets have been produced for the British Army at the 254,000 sq ft site for over 75 years with Radway Green being acquired by BAE Systems from the Royal Ordnance in 1987. The company has another 22 years left on its lease, for which its pays £2.9m in annual rent.
Previous Post
Pub Chain beats Rivals with £1.2m bid for Belfast Church
