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26 Mar 02. AEA Technology has been appointed sole supplier and has agreed a contract in the region of £47m to advise on all portable power systems requirements as well as to supply the batteries and chargers for the Ministry of Defence’s (MoD’s) Bowman battlefield communications systems programme. The £47m package price, the majority of which will go to AEA Technology, includes the initial spares. The contract, which covers a four year supply period, has been awarded by the MoD’s prime contractor for the Bowman programme, General Dynamics United Kingdom Limited.

During the period of the contract, up to 140,000 battery packs, using AEA Technology’s state-of-the-art Lithium-ion Kaizen cells, and 10,000 chargers will be supplied. They will enable portable radios, handheld computers and encryption devices to last longer between charges and function in extreme environments while weighing substantially less – all super-critical factors in today’s battlefield conditions.

The contract represents a significant breakthrough for AEA Technology and the most powerful endorsement yet for its investment in world-leading battery and charger technology, in particular the Kaizen cell. The Kaizen cell has a strong and distinctive competitive position and is significantly ahead of the competition. It operates in the most adverse conditions from +75 degrees centigrade to – 51 degrees centigrade. The high cycle life means that the batteries last longer and fewer spares are required so soldiers can operate for far longer periods. The Kaizen cell provides the same power for a third of the weight of batteries currently in use.

The battery packs and chargers will be supplied by AEA Battery Systems. The Kaizen cells which go into the packs are backed up by Japanese commitment to quality and reliability. They will be supplied by AGM Batteries, AEA Technology’s joint venture with Japan Storage Battery Co., Ltd and Mitsubishi Materials Corporation.

The world market for Lithium-ion rechargeable batteries is worth around £2.5bn per annum and is expected to continue to grow strongly. Against this background, AEA Technology will continue to invest in, and develop, its Battery Systems business and consolidate its strong position in a growing market place. While the majority of the market currently comprises mobiles and laptop computers, AEA Technology is now starting to target and penetrate higher value-added market segments where high reliability and exceptional performance are demanded.

Commenting on the contract win, AEA Technology’s Chairman Peter Watson said:

“This win is good news for our shareholders and represents a breakthrough for the company. We will build on this strong platform and seek other markets where customers demand the high added value service and products that we can supply. We will target markets similar to the defence industry like medical, emergency services, space satellite and marine applications where a premium is placed on intelligent battery systems that offer advanced performance in challenging and hostile environments.”

The batteries and Kaizen cells will be manufactured at AEA Battery Systems state-of-the-art factory in Thurso, Scotland. The chargers will be manufactured at a new facility which may be built in Scotland subject to negotiations with agencies about funding.

Comment: This is good news for AEA whose share price hit a wobble at the time of the Archer collapse when the company had already won the contract. Now the company is on course to benefit from supplying batteries for BOWMAN and other projects.

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