KONGSBERG Strengthens its Defense Business

15.09.2017 Europe
KONGSBERG Strengthens its Defense Business

KONGSBERG Strengthens its Defense Business

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To strengthen KONGSBERG’s competitive edge in the defense market, the Group merges its two defense areas. The new business area, Kongsberg Defense & Aerospace, will further strengthen its position in a growing defense market.

The merger will result in a more integrated, coordinated and strong defense unit ensuring value and growth through delivering advanced defense technology to customers and partners. The new business area will be operational from October 1st 2017.

“Our solid positions within defense have over time been confirmed, and we are facing considerable opportunities in the defense market, whilst at the same time experiencing increased competition. By merging our two defense areas we will ensure a more effective and coordinated utilization of our joint resources, both in sales and marketing, and within product development and production. A strong and well-coordinated sales and marketing function is key to win important programs that will be driving the group’s value creation going forward”, said Geir Håøy (photo), President and CEO of KONGSBERG.

Kongsberg Protech Systems had revenues of NOK 2.1 billion in 2016. The business area is the global market leader for remote weapon stations, but demand is currently at lower levels than before, and new, larger contract opportunities are somewhat further ahead. Kongsberg Defense Systems’ revenues were NOK 4.3 billion in 2016.

The business area is well positioned within its niches, and the international interest for several of the area’s products is considerable. The merger will entail Kongsberg Protech Systems being integrated as a division in line with the five existing divisions of Kongsberg Defense Systems. Eirik Lie, currently President of Kongsberg Defense Systems, will be President of Kongsberg Defense & Aerospace.

“We continuously have to ensure an effective utilization of our resources to ensure further growth and profitability. A joint defense business strengthens our position for the opportunities ahead of us”, added Håøy.

Following the merger, the new business area will adjust its capacity within certain functions and obtain other efficiency synergies, expected to give total annual cost reductions of approximately NOK 100 million from 2018.

KONGSBERG is an international, knowledge-based group delivering high technology systems and solutions to clients within the oil and gas industry, merchant marine, defense and aerospace. KONGSBERG has 7 000 employees located in more than 25 countries and total revenues of NOK 15.8 billion in 2016.

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