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BAE Said to Hire LEK for Review to Sustain Shipbuilding Unit

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Jan. 16 (Bloomberg) -- BAE Systems Plc, Europe’s largest defense company, hired LEK Consulting LLP to conduct a review of its shipbuilding division, a person with knowledge of the situation said.

LEK will mainly provide modeling and analytical advice to the London-based weapons maker, said the person, who declined to be identified because details of the contract are private.

BAE is looking to sustain its 6,000-strong shipbuilding workforce before contracts for aircraft carriers and Type 45 destroyers dry up, and as it waits for a U.K. frigate contract to start. The company signed a 15-year, low-cost shipbuilding agreement with the U.K. government in 2009, getting vessel orders in return for ensuring Britain’s warship capability.

The British manufacturer is seeking export orders to ensure the commercial viability of its Global Combat Ship program, including a Type 26 frigate that could be in production until 2030. LEK provides strategic advice to manufacturers in industries from energy to aerspace.

The U.K.’s Independent newspaper earlier reported BAE had taken on LEK as a consultant and that Glasgow and Portsmouth yards may face closure.

To contact the reporter on this story: Sabine Pirone in London at spirone@bloomberg.net

To contact the editor responsible for this story: Benedikt Kammel at bkammel@bloomberg.net

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