Devonport Management Limited

From Wikipedia, the free encyclopedia

DML is the consortium which owns and manages Devonport Royal Dockyard, the largest dockyard in Western Europe.[1] DML is currently owned by KBR (51%), Balfour Beatty (24.5%) and The Weir Group (24.5%).[2]

In January 2007 several reports suggested that BAE Systems wishes to take control of DML, with potential partners named as Rolls-Royce plc and Carlyle Group.[3] BAE owns the only shipyard capable of building nuclear submarines, BAE Systems Submarine Solutions at Barrow-in-Furness, and the Independent on Sunday has suggested that the Ministry of Defence is keen to see such consolidation.[4] This mirrors the urging of the MoD for BAE and VT Group to merge their surface shipbuilding operations.

[edit] History

DML, then owned by Brown and Root and Vickers Design and Projects, was one of three companies bidding for the Devonport contract in 1986. The others were Devonport Dockyard, formed by the then management of the dockyard, and a consortium of Foster Wheeler, A & P Appledore, and Wharton Williams.[5]

The DML consortium changed in 1987, with B&R taking 29.9%, Balfour Beaty joining with 29.9%, the Weir Group joining with 29.9% and Barclays de Zoete Weld taking 10.3%. Vickers had formed a joint venture with B&R which included its contracting arm. The management contract was awarded to DML on 1987-02-24, with management officially transferred on 1987-04-06.[6] The dockyards remained property of the Ministry of Defence at this stage.

In June 1993 DML was awarded the contract for refitting of Royal Navy nuclear submarines. This was the result of a two year "highly politicised battle" between DML and the management of Rosyth Dockyard in Scotland.[7] The Rosyth dockyard already had nuclear refitting facilities under construction when, in 1993, DML made an unsolicited bid to take over the work which in future would only be awarded to one yard. For the next two years the two dockyards made "tit-for-tat" claims regarding the suitability of their own facilities compared to their competitor.[7]

In 1994 GEC acquired VSEL and withdrew it from the DML consortium. At the urging of the MoD, Brown & Root took 51% control of DML. In February 1993 DML purchased the Devonport yard for GB£40.3 million.[8]

In 2006 it was announced that Halliburton would be floating its subsidiary KBR on the stock market, this went ahead against the wishes of the UK government and Ministry of Defence as they felt the floating of KBR would make the DML group unstable.

In early 2007 it was announced that the DML group was for sale and major players in the world defence industry were rumored to be interested in buying the company from the current share holders. BAE Systems was one of the companies rumoured to be interested; The Independent on Sunday suggested that the Ministry of Defence was keen to see these combined with BAE's submarine manufacturing facilities.[9] In the end this purchase was not completed and DML was bought by Babcock International Group instead.

Only two companies made bids by the closing date, these were the Carlyle investment Group and Babcock International.

Babcock was announced as the successful bidder for Devonport in a deal that was worth 350 million pounds sterling and would secure them a 100% stake in the company. Babcock international announced that the DML Group would then become part of Babcock Marine Services, a new sector within its organization.

The deal was rubber stamped by the United Kingdom Ministry of Defence at the end of June 2007

[edit] References

  1. ^ HMNB Devonport : Naval Bases & Air Stations : Establishments : Operations and Support : Royal Navy
  2. ^ Welcome to DML Group
  3. ^ Robertson, David. "Bid talks for subs yard surface between BAE and Rolls-Royce", The Times, Times Newspapers, 2007-01-15. Retrieved on 2007-01-28. 
  4. ^ Foley, Stephen. "BAE finds clear blue water in bid to win Devonport yard", Independent on Sunday, Independent News and Media, 2007-01-28. Retrieved on 2007-01-28. 
  5. ^ Buchan, David. "Three Bid For RN Dockyard", Financial Times, The Financial Times, 1986-08-30, p. 3. Retrieved on 2007-01-19. 
  6. ^ "Devonport under commercial management", PR Newswire Europe, Origin Universal News Services Limited, 1987-04-06. Retrieved on 2007-01-19. 
  7. ^ a b White, David. "Shrinking navy prompted great nuclear race: David White tracks the two-year highly politicised battle for the contract to refit Trident submarines", Financial Times, The Financial Times, 1993-06-25, p. 8. Retrieved on 2007-01-19. 
  8. ^ "Anglo-American consortium buys Devonport Royal Naval Dockyard for pounds 40m", The Independent, Newspaper Publishing, 1997-02-12, p. 17. Retrieved on 2007-01-19. 
  9. ^ Foley, Stephen. "BAE finds clear blue water in bid to win Devonport yard", Independent on Sunday, Independent News and Media, 2007-01-28. Retrieved on 2007-01-28. 

[edit] External links