12 August 2021

Denel announces restructuring in effort to reform company

by Charles Forrester

South Africa's Denel formally announced the reorganisation of the company from six divisions to two, as part of a broader five-year plan.

“We are determined to turn Denel around and repurpose it while retaining the core capabilities required to meet South Africa's strategic security requirements,” William Hlakoane, Denel's interim Group Chief Executive Officer, said.

Announced on 11 August, information about the reforms began to leak out at the end of July, following a written question from the National Assembly member Michéle Clarke of the opposition Democratic Alliance to the Minister of Public Enterprises, Pravin Gordhan.

The plan, known as Denel 5.Y, involves the creation of two divisions – Engineering, and Manufacturing and Maintenance – that merges a number of existing product lines and brands into the new structure.

Denel's revenues and operating profit have shown significant volatility in recent years, as losses have continued more recently. (Janes)

The Engineering division will merge Denel's capabilities in artillery, infantry and vehicle systems, missile and precision-guided munitions business, as well as its management of complex integrated systems.

The Manufacturing and Maintenance division will be responsible for work in aeronautics, unmanned aerial vehicle systems, and the production of small and medium calibre ammunition as well as the production of combat vehicles.

The Engineering division will also be involved in the diversification of technology into existing and new markets in fields that include command and control, cyber security, and communications, as well as undertaking research and development activities.

South Africa's Denel formally announced the reorganisation of the company from six divisions to two,...

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