Japan adds USD6.8 billion to 2021 defence budget

by Jon Grevatt & Andrew MacDonald

Japan's defence budget for fiscal year 2021 has received a boost of USD6.8 billion. However the country's military expenditure is now forecast by Janes to decline in 2022. (Janes Defence Budgets)

The government of Japan has approved a supplementary defence budget of JPY773.8 billion (USD6.8 billion) for fiscal year (FY) 2021.

Japan's Ministry of Defense (MoD) said on 26 November that the additional expenditure is required to boost Japan Self-Defense Forces' (JSDF) capability in response to escalating security risks in the Indo-Pacific.

The supplementary budget – referenced by the MoD as a ‘defence-strengthening acceleration package' – is in addition to Japan's FY 2021 defence budget of JPY5.34 trillion.

The combined expenditure takes Japan's defence expenditure for the fiscal year, which runs April–March, to more than JPY6 trillion for the first time.

Budgetary documents issued by the MoD show that more than half of the supplementary budget is aimed at supporting the national defence industry.

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Piaggio Aerospace relaunches sale process

by Charles Forrester

Piaggio Aerospace announced on 19 January that it was re-opening the sale process to acquire the company. (Piaggio Aerospace/Paul Cordwell)

Piaggio Aerospace announced on 19 January that it has formally restarted the process for finding a new owner following the collapse of a potential bid last year.

The company's Extraordinary Commissioner, Vincenzo Nicastro, announced the relaunching of the sale, with formal advertisements being placed in a number of financial news outlets.

“Discussions with a number of counterparties are still ongoing, but we want to be sure we can guarantee a long-term future for the company”, Nicastro said. “That's why we are formally starting the sale process again. But not from scratch: The preparatory work on the data room is already done, while we have set very tight deadlines for the due diligence and bid submission phases in order to speed up the process as much as possible. As always, we will carefully evaluate all the offers that will be submitted,” he added.

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QinetiQ US, Teledyne FLIR Defense get new leaders

by Marc Selinger

UK-based defence contractor QinetiQ Group has named Northrop Grumman executive Shawn Purvis as president and CEO of its US business, according to a 17 January announcement.

Purvis has been president of Northrop Grumman's Enterprise Services organisation for the past four years, overseeing the US defence contractor's information systems. At QinetiQ US, she will replace Mary Williams, whose decision to step down was revealed in October 2021.

Purvis will have plenty to do in her new role, which begins in mid-February. QinetiQ has said it wants to more than double the size of its US business over the next five years through organic growth and acquisitions.

Separately, US industrial conglomerate Teledyne Technologies announced on 18 January that it has promoted JihFen Lei to executive vice-president of Teledyne FLIR's defence business.

Lei will also continue to serve as general manager of the Surveillance unit within Teledyne FLIR Defense. Before rejoining Teledyne in 2021, Lei worked at the US Department of Defense, including as acting deputy undersecretary of research and engineering.

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UK CMA finishes review of Cobham's bid for Ultra Electronics

by Marc Selinger

The UK Competition and Markets Authority (CMA) has completed its assessment of whether Cobham Group's proposed acquisition of Ultra Electronics raises national security concerns, the CMA announced on 18 January.

The report, which has not been publicly released, is in the hands of UK Business Secretary Kwasi Kwarteng, who requested the review in August 2021. Kwarteng will “carefully consider” the document before deciding on next steps, including whether the acquisition should receive further scrutiny or be approved with conditions, according to a government spokesperson.

“While the government welcomes foreign investment, it is right that we fully consider the national security implications of this transaction,” the spokesperson said.

The government did not indicate when Kwarteng would make his decision.

Cobham has offered GBP2.6 billion (USD3.5 billion) for Ultra, saying the combination would create a “global defence electronics champion”. Although Cobham and Ultra are both based in the UK, Cobham is owned by US private equity firm Advent International, which has come under fire for divesting several Cobham businesses since it bought the storied company in January 2020.

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