Electro Optic Systems Holdings Limited (ASX: EOS) and Nova Systems Pty Limited have formed the Sovereign Missile Alliance (SMA), a 100% Australian-controlled joint venture with EOS and Nova as equal partners.
The formation of the partnership follows the Commonwealth Government’s announcement that it expects to outlay $1 billion from mid-2022 to establish a Sovereign Guided Weapons (principally missiles) and Explosive Ordnance Enterprise (GWEOE) to manage its portfolio of GWEO.
The Enterprise will comprise the Commonwealth Department of Defence and one or more Sovereign Industry Partners (SIPs) to be selected under a competitive process.
The Commonwealth has forecast GWEO requirements exceeding $40 billion over the period to 2040, and industry and analyst estimates range to $100 billion.
The selected SIP(s) will be responsible for some or all of the following aspects of GWEO management: manufacturing, research and development, education and training, test and evaluation, maintenance and repair, storage and distribution, and disposal.
A key requirement is the engagement of Australian industry to improve capability resilience, availability of inventory and responsiveness to demand.
Dr Ben Greene, Group CEO, EOS, said the SMA will compete for selection by Defence as a SIP. The SMA has a unique set of attributes that align with requirements for a SIP in the Enterprise:
- Sovereign. It is Australian owned and controlled. It is demonstrably “sovereign” using any definition applicable.
- Critical Mass. It has the scale to move forward quickly to meet Enterprise objectives. Its partners, Nova Systems and EOS, jointly have over 1,000 skilled staff, 18 facilities across Australia, and over $0.5 billion in revenue.
- Supply Chain. The SMA already has an extensive Australian supply chain network of more than 600 SMEs, with many qualified to defence aerospace standards.
- Experience. SMA partners have jointly over 55 years of experience in defence aerospace industry.
- Capabilities. The SMA has design, development, systems integration, test and evaluation, certification and systems assurance for military aerospace products. · Technology.
Through EOS, the SMA can access the largest Australian-owned portfolio of aerospace technologies, and join the largest national tertiary collaboration programs in Australian defence industry.
This technology is applicable to improving missile maintenance and to the development of next-generation missiles. The SMA will leverage its two partner companies, EOS and Nova Systems, for the resources to move rapidly through an establishment phase to quickly deliver improvements to the operational readiness and cost-effective growth of Australian missile stocks and other GWEO inventory.
“The sovereign capability to deliver guided weapons already exists in-country and the SMA creates an Australian owned entity of scale with the required capabilities, resources, funding and established relationships across the broader Defence ecosystem to start this journey with the Commonwealth now,” said Jim McDowell, Group CEO, Nova Systems.
“The SMA will establish a sustainable, domestic capacity through a Common User Facility to manufacture and support customer-selected foreign missiles under license, using our indigenous supply chain.
We have the core competencies, advanced R&D capabilities, existing IP, and established technology partnerships to create the next generation of guided weapons optimised for Australian requirements with full sovereign ownership and control. The Common User Facility will progressively move to produce these missiles,” Dr Greene said.
