UK Defence Firms Plan £19.75bn Investment Over Next Year
According to new research from law firm White & Case, UK defence companies intend to invest a combined £19.75bn over the next 12 months. This totals an average of £79m per company, with 250 senior decision-makers at UK defence firms and start-ups surveyed for the study.
Key Findings:
- Staying competitive (50%) is the primary motivation for investment.
- Demand for next-generation defence technology (42%), export opportunities (38%), and rising government defence spending (33%) are also significant drivers.
- Cybersecurity (46%), advanced sensors (45%), and space technology (39%) are top priorities for investment in defence technology.
- 57% of companies plan to invest in traditional defence hardware, with air defence and counter-drone systems being the primary focus (68%).
"The nature of conflict has changed completely in the last five years and strengthening air-defence systems is now a major priority," stated Angus Nunn, a growth capital and technology M&A partner at White & Case.
Investment Trends:
- 76% of firms plan to expand within the UK over the next year.
- 55% aim to grow elsewhere in Europe, 27% in the US, 26% each in the Middle East and Asia-Pacific.
- 97% of companies intend to raise significant external funding in the upcoming year.
Nunn predicts an increase in mergers and acquisitions (M&A) as more investors seek exposure to the sector. Patrick Sarch, leading UK public M&A at White & Case, adds that the UK's strong defence and technology businesses attract "deep pools of capital," but stresses the need for continued access to funding on favourable terms to ensure global competitiveness.
By Ana-Maria Stanciuc, Editor-in-Chief, TNW