Babcock International is expecting an increase in outsourcing work opportunities from its biggest customer the Ministry of Defence (MoD), while seeking small acquisitions in overseas markets such as Eastern Europe.
Chief Executive Peter Rogers said the engineer and support services group, which already manages a number of naval bases including the nuclear submarine base in Devonport, England, said he thought the MoD would start to put out more work to tender from the army and airforce divisions.
"There will be more outsourcing -- there's not much more the navy can do, but the army could outsource more, and the RAF could outsource more -- it will happen gradually," he told in an interview.
He also said Babcock is boosting its presence overseas, and while he ruled out entering the world's biggest defence market the United States, he said he was keen to target Eastern Europe.
"In Eastern Europe we need to acquire something with good existing management -- it is one place we are looking," he said, although small acquisitions are the more likely option.
Babcock works on new nuclear build and railways as well as defence projects. Its shares were down 1 percent at 502 pence by 10:43 a.m., valuing the firm at around 1.1 billion pounds.
Source: http://uk.reuters.com/
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