BAE Systems will provide Malaysia with a UK government-backed financing deal, if the country chooses the Eurofighter Typhoon, Reuters has reported. Malaysia is currently weighing France’s Rafale jet and the Eurofighter Typhoon as it looks to buy up to 18 jets to replace its Russian MiG-29s.
BAE Systems’ share price has advanced in London this morning, having added 0.25 percent to 567.40p as of 09:43 GMT. The shares are outperforming the broader UK market, with the benchmark FTSE 100 index having slipped marginally into the red and currently standing 0.06 percent lower at 7,172.58 points. The group’s shares have lost more than seven percent of their value over the past year, as compared with about a 1.4-percent dip in the Footsie.
Reuters reported this morning that BAE Systems was offering Malaysia a UK government-backed financing deal if it decides to replace its fleet of combat jets with the Eurofighter Typhoon. Financing would be provided via the UK Export Finance export credit agency.
“We have an offer on the table [...] It’s competitively priced and we have offered UK government financing so the Malaysian government can spread the payment over a longer period,” Alan Garwood, the Group Business Development Director for the British defence contractor told the newswire in an interview in Kuala Lumpur.
BAE is in competition with France’ Dassault Aviation – makers of the Rafale jets – which until recently was seen as frontrunner. The UK group believes that Malaysia will arrive at a decision following its upcoming national elections, due to be held by August.
Analysts on BAE Systems
The 19 analysts offering 12-month price targets for BAE Systems for the Financial Times have a median target of 670.00p on the shares, with a high estimate of 798.00p and a low estimate of 460.00. As of February 10, the consensus forecast amongst 21 polled investment analysts covering the blue-chip group has it that the company will outperform the market.