Babcock International

British Aerospace & Defence Company

Following its establishment, the British company's sphere of operation was defined as 'the world except for North America and Cuba', which was the preserve of the US Babcock & Wilcox venture. Around this time, the inventor and businessman Isaac Singer was a significant and influential shareholder in the business. During 1895, Babcock & Wilcox Ltd opened a new boilermaking works, based on the site of the Porterfield Forge on the opposite side of the River Clyde near Renfrew. By 1985, Babcock International's turnover had reached £1.1 billion; its subsidiaries were engaged in ventures and projects across the world, typically focusing on its contracting activities. Its materials handling business, which had been unprofitable since the 1970s, was subject to restructuring efforts and job losses around this period. In November 2006, Mitsui sold the company to Doosan Heavy Industries & Construction, a subsidiary company of the Doosan Group of South Korea: at that time the company was renamed Doosan Babcock Energy Ltd. In September 2009, the Czech based steam turbine manufacturer, Skoda Power, became part of Doosan Babcock Energy Ltd; this venture was subsequently rebranded Doosan Power Systems Ltd in 2010.

In 2000, Babcock took the strategic decision to move away from manufacturing towards maintaining and supporting the critical equipment and infrastructure of customers. Reflecting the successful shift in the company's strategic focus, in 2002 Babcock was duly reclassified on the London Stock Exchange from 'Engineering' to 'Support Services'. On 19 June 2002, the company acquired Service Group International Ltd, a provider of support services in defence and civil markets. and on 13 June 2006, it bought the high voltage power lines and mobile telecoms business of ABB South Africa (Pty). On 25 July 2007, the United Kingdom Government announced that the Aircraft Carrier Alliance, of which Babcock International is a part, would carry out final assembly of two new aircraft carriers for the Royal Navy at their Rosyth Dockyard. On 7 August 2007, acceptances for the acquisition of International Nuclear Solutions PLC reached 58.9% of issued share capital, and a takeover was then completed. On 22 April 2008, to further strengthen the brand in the nuclear sector and submarine support sector, Babcock acquired Strachan & Henshaw from the Weir Group for £65m; at the time of the transaction, the company had over 50 years of experience in high integrity material handling. In September 2009, Babcock acquired the UK Atomic Energy Authority's commercial arm, UKAEA Ltd; this acquisition extended Babcock's existing nuclear skills, bringing additional expertise in waste categorisation, decommissioning of high hazard facilities, encapsulation and storage of hazardous materials and transportation of waste. The deal also provided Babcock with its first operational Tier 1 position in the civil nuclear market and a direct relationship with the Nuclear Decommissioning Authority, complementing its existing Tier 1 position in the military nuclear market. As a result of the merger, Babcock took over the contract to operate the Defence High Frequency Communications Service on behalf of the Ministry of Defence; this contract was originally awarded to VT Merlin Communications in 2003, for a period of 15 years. During March 2014, it was announced that Babcock had agreed to wholly acquire Avincis Group, including its subsidiary Bond Aviation Group, in exchange for £1.6 billion. The former Avincis units was subsequently rebranded under the Babcock name in January 2015. In July 2013, Babcock's Support Services division acquired Conbras Serviços Técnicos de Suporte LTDA in Brazil for a cash consideration of £18.2 million plus deferred consideration of £4.4 million. In April 2014, Babcock Dounreay Partnership (BDP), a consortium of Babcock International Group PLC (50%), CH2M Hill (30%) and URS (20%) was selected as preferred bidder and eventually awarded a £1.6bn contract by the Nuclear Decommissioning Authority for the management and decommissioning of the Dounreay nuclear site in Scotland. In November 2014, Babcock was named as the British Government's preferred buyer of the land repair and maintenance business of the Defence Support Group, an executive agency and trading fund of the Ministry of Defence. The sale and transfer to Babcock was completed on 1 April 2015. Throughout the 2010s, the company secured numerous naval contracts. In May 2012, Babcock was awarded a £15m contract by the Ministry of Defence to support the design of the United Kingdom's next generation nuclear armed submarines. In August 2014, Babcock issued a statement declaring that there would be job losses at HMNB Clyde if Scotland were to vote in favour of independence in the 2014 Referendum. In October 2014, both Babcock and BAE Systems won contracts from the Ministry of Defence worth a total of £3.2 billion to maintain British warships, submarines and naval bases for the following five years. In December 2014, the Ministry of Defence alienated the non aerospace assets of the Defence Support Group to Babcock. In September 2019, it was announced that Babcock had been selected as the preferred bidder to build the new fleet of five Type 31 frigates for the Royal Navy. During 2018 and 2019, Babcock rebuffed multiple unsolicited advances by public services provider Serco to merge the two businesses together. Merger proposals had been unanimously rejected by Babcock's board, having reportedly found the proposal to lack strategic merit. Reportedly, Rupert Soames, Serco's Chief Executive, remained interested in aligning his company's defence operations with Babcock's own divisions. At multiple occasions in 2019 and early 2020, Babcock issued profit warnings, which the firm attributed to a downturn in government orders and issues with its aviation division, necessitating a £85m writedown on leases for its North Sea helicopter fleet. During February 2020, it was reported that the company was considering exiting the off shore helicopter sector amid intense competition; Babcock had already reduced its Sikorsky S 92 and Eurocopter EC225 Super Puma fleets from 15 to seven helicopters and 13 to one helicopters respectively. The firm's decision to downsize its S 92 inventory caused manufacturer Sikorsky to sue Babcock over its refusal to accept delivery of units ordered in 2011. In April 2021, as part of a wide ranging restructuring program, Babcock announced that it would be selling off a number of its business lines, resulting in 1,000 job losses (850 of which would be in the United Kingdom); as part of this, the firm will sell its oil and gas aviation transport arm to CHC Group. The company also confirmed the disposal of its helicopter support business in July 2022. In March 2023 Babcock International sold the emergency aviation businesses in Finland, Italy, Norway, Portugal, Spain and Sweden to UK group Alacala Partners which re formed them into the Avincis Group.

In February 2023, the British Royal Navy ordered an investigation into the repairs made by Babcock International engineers on a Trident submarine after it was discovered that glue had been used to fix broken bolts in the nuclear reactor. A navy source told The Guardian newspaper: “It’s a disgrace. You can’t cut corners with nuclear. Standards are standards. Nuclear standards are never compromised.”

The company is organised into four sectors: Marine, Land, Aviation and Cavendish Nuclear.

+Babcock International Group plc financial results. Year ended Revenue (£ million) Operating Profit (£m) Profit/(loss) before tax (£m) Earnings per share (p)20234,438.645.56.2(6.9)20224,101.8226.8182.332.520213,971.6(1,736.7)(1,811.0)(357.0)20204,449.5(106.3)(178.2)(38.6)20194,474.8280.3235.239.520184,659.6439.1391.166.620174,547.1416.3 362.161.820164,158.4387.1330.157.020153,996.6381.7 313.152.920143,321.0254.0218.844.320133,029.4252.5 224.6 53.020122,848.4206.3 173.0 42.920112,564.5 159.3111.130.1