Shares in BAE Systems (LON:BA) have jumped in London this morning, with Qatar set to purchase 24 Typhoon jets from the UK group. The order will mark the UK’s first major defence contract with the Gulf state, and is a boost for the FTSE 100 group which meanwhile has been trying to reach a deal with the Saudi government for a new order of 48 Typhoons.
As of 08:45 BST, BAE Systems’ share price had added 2.85 percent to 613.00p, outperforming the broader UK market, with the benchmark FTSE 100 index currently 0.37 percent up at 7,242.32 points. The group’s shares have added more than 15 percent to their value over the past year, and are up by some four percent in the year-to-date.
Reuters reported last night that according to state news agency QNA, Qatar’s defence minister had signed a letter of intent to purchase 24 Typhoon jets from BAE Systems. The agreement was signed by Minister of State for Defence Affairs Khalid bin Mohammed Al Attiyah and his British counterpart Michael Fallon.
“This will be the first major defence contract with Qatar, one of the UK’s strategic partners,” Fallon said in a separate statement. Neither statement, however, gave the cost of the combat jet deal.
The Financial Times meanwhile quoted BAE as welcoming the statement of intent and noting that discussions were ‘ongoing’. The newspaper added that the company has been trying to tie down the Saudi government to a new order of 48 Typhoons for some time, but discussions have failed to reach a conclusion.
Today’s news comes after BAE Systems recently submitted a bid to build new warships for Australia, with Canberra launching one of the Western world’s largest fleet renewal programmes.