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EUROPE
18 Sep 25. EU invest €30m in first private credit vehicle dedicated to defence. The fund will provide debt solutions, enabling SMEs to expand production and build up war stocks. The European Investment Fund, the European Union’s (EU) specialised financial institution for risk finance, is aiming to strengthen the defence supply chain with a €30m ($35.5m) injection into the first private credit vehicle devoted exclusively to financing small and medium enterprises (SMEs) in defence. On 17 September 2025, the EU Commission confirmed that Sienna Investment Managers (IM) will oversee the new fund, called Sienna Hephaistos – aptly named after Hephaestus, the Greek god of blacksmiths. That same day, Sienna marked its first closing, that is, the beginning of its fundraising period and allowing the fund to begin operations and make initial investments. So far the company has secured more than €270m, but looking ahead Sienna aim to raise between €500m and €1bn by the end of 2026.
How will the new fund operate?
Sienna Hephaistos is a debt fund intended to support the subcontracting chain of major groups in Europe’s growing defence industry.
Sienna’s French private credit management team will deploy the inflows across Europe. It is said that the fund will support 30 to 40 companies. These loans will finance an SME’s working capital, capex, and external growth operations, in addition to capital financing and bridging existing bank financing.
“Historically committed to the financing of mid-market companies, [Sienna] are convinced that the mobilisation of all financial players, banks, alternative lenders, equity investors, is crucial for the European defence industry,” said Laurent Dubois, managing director and chief information officer, private credit, Sienna IM.
“This is key for sovereignty, development and reindustrialisation of our regions,” he continued.
The EU Commission echoed these words in their press release, suggesting the new fund will bridge the financing gap by providing tailor-made debt solutions that enable companies to expand production build up inventories, and support industry consolidation.
By easing supply chain bottlenecks, the fund directly contributes to scaling up European defence production and reinforcing Europe’s strategic autonomy.
SME troubles in defence
William Ashford-Brown, director of strategic insights at the Heligan Group, a UK-based investment company, touched on some of the factors behind why SMEs struggle in defence. Although attitudes are now changing, “the limited access to funding is, at its core, a consequence of risk,” he observed.
“Defence SMEs are inherently hamstrung by a number of unique sectorial factors – long, unpredictable procurement cycles; high customer concentrations; and cash flow issues – all of which combine to raise their risk profiles when being assessed for investment and lending,” Ashford-Brown identified.
“War and instability amplify the problem,” said Andriy Dovbenko, principal of UK-Ukraine TechExchange, a group connecting British and Ukrainian start-ups with capital and individuals who can get technologies to market through in-field testing.
“In Ukraine, although the war has created urgent demand for scaling production, it has also heightened material and financial risks such as supply chain disruptions, infrastructure damage, and currency fluctuations.
“These make both lenders and investors cautious. That’s why this new [EU-backed] fund is so crucial. It recognises the realities of the sector and provides financing solutions where banks might hesitate, enabling critical suppliers to scale and reinforce Europe’s strategic autonomy when it comes to defence and future peace.”
Strategic autonomy
While many European countries have taken up a policy of ‘strategic autonomy’, prompted by transatlantic divisions, namely US tariffs and America’s military detatchment from Europe, disentangling from the US defence technological and industrial base is implausible.
Europe’s foremost complex weapons systems builder MBDA has hinted its ability to pivot away from any reliance on US components should the customer require. However, this is less compelling given that throughout 2024 Britain and France had to restrict Ukraine’s use of MBDA’s Storm Shadow/SCALP cruise missiles deep inside Russian territory as the US was not inclined to escalate the conflict until late in the year.
Still, Europe aims to tip the scale in its favour with a set of objectives laid out in its inaugural defence industrial strategy, issued in April last year. This strategy aims for intra-EU defence trade to represent 35% of the value of the EU defence market, and the plan will also see the EU procure 50% of their defence procurement budget within the union by 2030 and 60% by 2035.
In addition, the EU’s €30m commitment shows it will also foster debt financing, which will open up new avenues of funds for SMEs driven by the long-term demand for military resources needed to resist Russian hybrid – so-called ‘gray-zone’ – activity.
Similarly, in March 2025, the German Parliament decided to end years of fiscal restraint by agreeing to remove the debt brake, a policy that now allows defence and certain security budgets to increase beyond the confines set by the country’s restrictions on budget deficits. (Source: army-technology.com)
167 Sep 25. US F-35A Fighters Confirmed for Switzerland in 2027 Balancing Security and Rising Costs. In a statement to Keystone-ATS on September 6, 2025, the spokesperson for Armasuisse confirmed that the delivery of F-35A aircraft for Switzerland is still scheduled to begin in mid-2027 from the American manufacturer Lockheed Martin’s facility. For the government, it is now considered too late to reverse course, as the F/A-18 Hornets approach the end of their operational life and the first aircraft are expected to arrive in 2027 from Fort Worth, followed by deliveries from Cameri in 2028. On September 7, 2025, the U.S. Air Force F-35A Lightning II Demo Team showcased advanced aerial maneuvers at the Thunder Over New Hampshire Air Show, highlighting the fifth-generation fighter’s combination of stealth, speed, and agility. (Picture source: US DoD)
The contract signed in September 2022 covered 36 F-35As for 6.035 billion Swiss francs. However, the U.S. Foreign Military Sales framework does not provide strict price guarantees by production lot, and the overall bill could rise by 650 million to 1.3 billion francs. In a country where the six-billion-franc ceiling was approved in a 2020 referendum, this increase has fueled controversy. Additional U.S. tariffs have further heightened tensions in Switzerland, where issues of industrial and budgetary sovereignty remain highly sensitive.
Public debate has hardened. Some, such as former astronaut Claude Nicollier, argue that the fleet should be expanded to 50 aircraft to meet long-term needs. Others advocate more radical solutions, including the proposal to delegate air policing to a European neighbor. Between these positions, Defense Minister Martin Pfister maintains a middle course, keeping the F-35 as the chosen option while leaving open the possibility of adjusting the fleet size to remain within the approved budget, which could reduce the order to around 30 to 32 aircraft.
Switzerland has selected the F-35A in the Block 4 standard, intended to expand its range of weapons, improve data fusion, and increase computing power. However, a report published by the U.S. Government Accountability Office (GAO) on September 3 pointed to further delays and a reduced scope of capabilities in the near term, as the F135 engine and the PTMU cooling system have yet to receive the planned upgrades. In addition, the manufacturer has accumulated longer delivery delays than in the past, which obliges Bern to carefully synchronize the arrival of the F-35 with the gradual retirement of the Hornets.
The F-35A Lightning II is a multirole stealth fighter designed to provide both air superiority and precision strike capability. Its airframe is optimized for a reduced radar signature, while the AN/APG-81 AESA radar, the EOTS targeting system, and the Distributed Aperture System provide 360-degree coverage and advanced threat detection. The Helmet-Mounted Display System projects combat data directly into the pilot’s field of vision, enhancing responsiveness in both close-range engagements and beyond-visual-range operations. Powered by a Pratt & Whitney F135 engine producing 43,000 pounds of thrust with afterburner, the aircraft can reach Mach 1.6 and operate above 15,000 meters, with a combat radius of 2,200 km using internal fuel.
The aircraft’s armament underlines its versatility. It carries an internal 20 mm M61A2 Vulcan cannon and can employ AIM-120 AMRAAM and AIM-9X Sidewinder air-to-air missiles, as well as JDAM and GBU-39 Small Diameter Bomb precision-guided munitions. It is also capable of launching the AGM-88 HARM to neutralize enemy radar systems. Weapons are stored internally to maintain stealth, but the aircraft can also use six external hardpoints if required, at the cost of a larger radar signature. This flexibility enables it to cover a wide spectrum of missions, including interception, air policing, close air support, and suppression of enemy defenses.
Confirmation of the first deliveries in 2027 places Switzerland among the European states that will make the F-35 the backbone of their air forces for decades to come. Interoperability with other operators, shared training and support, and access to a continental logistics network all weigh in favor of this trajectory.
On the industrial side, the RUAG-led RIGI project foresees the assembly and testing of four aircraft in Switzerland, representing close to 500 million francs in expected returns. Overall, offsets are estimated at 60 percent of the contract’s value, a critical factor for the national aerospace sector. This industrial participation could strengthen maintenance autonomy, secure access to the European F-35 support chain, and generate skilled employment.
The remaining question concerns Switzerland’s position in future fighter programs. The GCAP on one side and the FCAS on the other outline two different European pathways for the post-F-35 era. Switzerland’s choice favors immediate integration into the dominant Western standard but may reduce its margin for involvement in these next-generation projects. The final equation combines three difficult constraints: maintaining a credible air capability, respecting the budget ceiling approved by referendum, and preserving strategic flexibility in an environment where air superiority is being rapidly redefined.(Source: NewsNow/armyrecognition.com)
16 Sep 25. General Atomics Aeronautical Systems, Inc. (GA-ASI), in collaboration with the Dutch Ministry of Defence and the Dutch Ministry of Economic Affairs, will host its second Blue Magic Netherlands (BMNL) event on November 18, 2025. BMNL 2025 follows the successful first event in 2024 and will take place at the MELT at Avular building, a world-class venue for technology interchange near Brainport Eindhoven, the center of the Dutch high-technology manufacturing industry. The registration site can be accessed at www.ga-asi.com/blue-magic-netherlands-2025.
“The first BMNL event was a huge success for Dutch industry,” said Brad Lunn, managing director for GA-ASI. “We’ve built strong investment opportunities with Dutch companies — including Arceon, Emergent Swarm Solutions, and Saluqi Motors — and now we’re looking to build on that success at BMNL 2025.”
Blue Magic Netherlands fosters technology ideation and implementation within the Dutch industrial ecosystem. GA-ASI is inviting Netherlands-based technology and aerospace companies, big and small, to apply for a chance to pitch transformative next-gen solutions that could shape the course of commercial and defence technologies. This event brings together leaders in advanced technology, aerospace, business, and government in a single Dutch forum to explore emerging technologies that address the world’s most pressing defence and security challenges. GA-ASI supplies its MQ-9A Remotely Piloted Aircraft to the Royal Netherlands Air Force.
Along with partners Brainport Development Eindhoven, Lockheed Martin Ventures, Brabant Development Agency and the Netherlands Industries for Defence & Security (NIDV), GA-ASI will accept proposals to present a broad range of technologies. Participating in this transformational event provides an ideal opportunity to connect with funding sources and collaborate with industry leaders. Companies and individuals wishing to only join the audience and network are welcome to register as well.
Companies interested in presenting their capabilities can submit a pitch proposal. GA-ASI and other participants will hear technology pitches followed by a lively panel discussion. Networking opportunities will also be available where participants can meet with other high-tech businesses and industry leaders to see if their capabilities can be leveraged in new and useful ways. Focus areas for this year are Intelligent Systems – Artificial Intelligence (AI)/Machine Learning and Autonomy, Smart Materials – Advanced Materials and Manufacturing, Sensors, Space, and Counter-UAS.
Companies interested in presenting their capabilities must submit pitch proposals in PDF format by no later than October 10, 2025. Companies selected to present pitches will be notified on November 3, 2025.
To submit a pitch proposal or register to attend in person or virtually, please visit the event website at www.ga-asi.com/blue-magic-netherlands-2025.
BMNL organizers will also host several virtual workshops covering a variety of topics relevant to defence technology start-ups. These workshops will be listed on the event website and are available for the entire Dutch innovation ecosystem.
REST OF THE WORLD
19 Sep 25. India revives army and air force light helicopter requirement. India’s requirement for Reconnaissance & Surveillance Helicopters (RSH), which has been under way since 2008, received a reboot with the nation’s Ministry of Defence (MoD) issuing a fresh request for information (RfI) in August for approximately 200 rotorcraft. Some 120 of these helicopters are destined for the Indian Army, and 80 for the Indian Air Force (IAF), to meet a long overdue requirement to replace their obsolescent Cheetah (Aérospatiale SA 315 B Lama) and Chetak (SA 316 Aérospatiale Alouette III) helicopters.
More than 600 Cheetah and Chetak helicopters were built under license in India by state-owned Hindustan Aeronautics Limited (HAL).
This latest RfI allows bids for single- or twin-engine helicopters able to undertake roles such as reconnaissance and surveillance, carrying troops/quick-reaction teams for special missions, carrying internal and external loads in support of ground operations, undertaking scout roles in conjunction with attack helicopters, casualty evacuation and search and rescue.
India’s requirement calls for the helicopters to have at least one weapon station on either side and with the ability to carry surveillance gear, rockets, podded guns, articulated guns, antitank missiles and/or air-to-air missiles.
Delhi’s original RSH requirement of 2008 called for 197 helicopters (133 for the army and 64 for the IAF) with licensed production to have commenced within 3-4 years of contract signature. Russia’s Kamov Ka-226T was selected for this RSH requirement in 2015.
Indo-Russian Helicopter Pvt Ltd was incorporated as a joint venture cum subsidiary between HAL, Russian Helicopters and Rosoboronexport in May 2017. The objective was to manufacture approximately 140 Ka-226T helicopters in India, with the initial 60 units to be acquired directly from Russian Helicopters.
However, stringent Indian technology transfer and indigenisation requirements derailed the programme, with no formal contract ever being inked. Kamov’s participation in the revised new tender is uncertain, and Safran Helicopter Engines earlier ruled out supplying its Arrius 2G1 turboshaft engines for the Ka-226T type.
HAL was also supposed to deliver 187 (126 army and 61 air force) indigenously developed Light Utility Helicopters (LUH) to meet the remaining portion of the Indian requirement.
Design and development of the LUH commenced in 2009, with the type supposed to have received initial operational clearance (IOC) by 2018, and all 187 helicopters being delivered by 2025-26.
IOC was eventually obtained for the IAF’s variant of the LUH in 2020, followed by that of the army version in 2021. In November 2021, the MoD approved production of twelve LUHs as part of a limited series production batch to be divided equally between the army and IAF.
At present, the frontrunner for the Indian RSH requirement is Airbus Helicopters, which announced in January 2024 that it was partnering with Tata Group to establish a final assembly line (FAL) for H125 helicopters in India.
Airbus Helicopters formalised this arrangement with Tata Advanced Systems Limited (TASL) in a July 2024 contract. Delivery of the first “Made in India” civilian H125 is slated for 2026.
“With its proven capabilities, the ‘Made in India’ H125 will also cater to the requirements of the Indian armed forces,” the European OEM announced last month.
Ironically, it was the H125 (previously known as the AS550 C3) that had lost out to the Ka-226T in the original RSH competition! (Source: AMR)
14 Sep 25. Australian PM, Deputy PM confirm multi-billion Henderson AUKUS investment. Prime Minister Anthony Albanese and Deputy Prime Minister and Defence Minister, Richard Marles will announce a multi-bn dollar investment into the consolidation and Western Australia infrastructure in support of AUKUS. Defence Connect can reveal that the Australian Prime Minister, Anthony Albanese alongside Deputy Prime Minister and Defence Minister, Richard Marles will announce an AU$12bn (US$7.96bn) in support of the trilateral AUKUS partnership.
It is expected that this multi-bn dollar, multi-year investment will support the consolidation of the Henderson naval shipyard facility, uplifting the facilities there to support submarine maintainence and sustainment in support of the Submarine Rotational Force – West (SRF-W).
Included in this investment is the development of new dry docks, loading facilities, along with other critically needed navation shipbuilding infrastructure and capabilities at the facilities, which are critically important for supporting the delivery of Australia’s eight locally-built evolved Mogammi class guided missile frigates under the SEA 3000 program, alongside Army’s advanced landing and littoral manoeuvre fleet.
This investment is expected to be part of a larger, almost AU$25 bn (US$16.61 bn) that will need to be invested at critical naval infrastructure at Henderson and at the nearby HMAS Stirling south of Perth to support Australian, British and American rotational submarine forces and deployed naval forces.
To date, the Commonwealth Government has commited approximate AU$127 m (US$84.4 m) dollars to support the consolidation of the naval infrastructure and shipbuilding facilities at Henderson.
This announcement comes following recent revelations reported in the Wall Street Journal that US Secretary of State, Marco Rubio has reportedly reassured Deputy Prime Minister and Defence Minister, Richard Marles that the AUKUS program and Australia’s pursuit of conventionally-armed, nuclear powered submarines was “safe”.
As part of this investment, the Government expects that it will support 10,000 jobs across the three AUKUS partner nations, and will provide a major uplift to the metropolitan and regional economies of Western Australia. (Source: Defence Connect)
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