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Local unit of global defence group enjoying significant success

23rd September 2016

By: Keith Campbell

Creamer Media Senior Deputy Editor

  

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South African private-sector defence company Saab Grintek Defence (SGD) is enjoying such success that it has had to recruit 198 new staff since January 2015, taking its workforce up to 719 people. The company, 75%-owned by Sweden’s Saab and 25% by black South African investors, now has customers in more than 30 countries and had sales of R1.07-billion last year. “We create jobs – high-tech jobs,” highlighted SGD president and CEO Trevor Raman in a pre-Africa Aerospace and Defence 2016 exhibition media briefing.

SGD is also seeking to stimulate and develop its product and service suppliers. “We’re doing a lot of outsourcing. We partner with a number of local companies,” he cited. “We really feel we’re part of the South African defence industry. Skills development is extremely important. We run many of our own staff training programmes. We’ve also started an incubator programme.” This last initiative seeks to develop new enterprises that could support SGD across a very wide range of products and services. For example, one of the beneficiaries of the incubator programme is a law firm. “We’ve also got the traditional bursary schemes.

“If you look at our revenue base, we’re 80% export,” he stressed. “The order backlog is growing.” The company’s new orders are currently worth R1.5-billion and the backlog extends to 2020.

As a result of the acquisition of the Saab Gripen fighter by the South African Air Force, the Swedish group bought a number of South African defence companies. Over the past 14 years, these have slowly been consolidated into one enterprise – SGD. The South African company is Saab’s biggest operation outside Sweden. SGD has a factory in Cape Town and two centres in Centurion, just south of Pretoria, and its staff includes designers, engineers and manufacturing personnel. Marketing is global, through the worldwide marketing arm of the Saab Group, which allows the South African business to focus on technology, engineering and research and development (R&D).

“We integrate very well into the different business units across Saab – the group has some 28 business units,” he reported. “We look where we have synergies and complement each other. We, [SGD], spend roughly 10% of our revenue on pure R&D. We’re in the air, land, sea and civil security businesses. SGD product areas are EW (electronic warfare), Data Acquisition and Communications – basically, avionics – Lead System Integration, Command and Control and Training and Simulation.”

The South African operation’s flagship EW product is its Integrated Defensive Aids Suite (Idas), which can be and is fitted to both fixed- and rotary-wing aircraft. Idas has been widely exported. Other EW products include the Civil Aircraft Missile Protection System, the Land Electronic Defence System, the Naval Laser Warner, and electronic support measures and electronic intelligence systems. All these systems were designed, developed and are manufactured in South Africa.

Data Acquisition and Communications products from SGD cover the monitoring, recording and management of communications. Lead System Integration involves using SGD’s capabilities to integrate other Saab products, from across the group, into customer-specific systems. “It’s a very successful model,” said Raman. With regard to Command and Control and Training and Simulation, ‘[w]e’re still the preferred supplier of the Chaka system”. Chaka is the South African Army’s tactical command and control system, for which there is also an associated training and simulation capability. The company is also involved in other training and simulation activities, both in South Africa and abroad.

“We have localised the fire control computer for the [Denel] Badger [infantry fighting vehicle] and manufacturing it here,” he pointed out. “We’ve indigenised it. And we’ve exported it to Malaysia.”

Apart from Malaysia, major export markets include Brazil and especially India. “India is by far our biggest customer; we’re working mainly with HAL (State-owned Hindustan Aeronautics Limited), but we’re entered into a partnership with Tata Power Strategic Engineering Division. We will replicate this model in other countries as well. I think Saab Grintek Defence has a very good story.”

Edited by Martin Zhuwakinyu
Creamer Media Senior Deputy Editor

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