U.K. Ministry of Defence Awards Rolls-Royce $1.2 Billion in Sub Work


Earlier this week, the United Kingdom Ministry of Defence awarded Rolls-Royce a 10-year contract worth $1.24 billion to produce and service nuclear propulsion systems for the Royal Navy's Astute-class fast-attack submarines and Successor-class ballistic missile submarines.

In exchange for giving Rolls the security of a 10-year contract for the work, the ministry hopes to cut as much as $310 million from the cost of its submarine enterprise performance program. It may also help save British jobs.

Minister for Defence Equipment, Support. and Technology Philip Dunne noted in a press release that the contract is expected to "help sustain around, 2,000 jobs while also providing a better deal for the taxpayer and ensuring our future plans remain affordable."

None of the seven Astute-class submarines, currently in various stages of construction, have yet entered operational service in the Royal Navy. The first of the line, HMS Astute, is expected to begin operational service this year. As for the Successor class, those subs are not expected to enter into service until 2028.

Both classes of submarines are being built by British defense contracting giant BAE Systems.

The article U.K. Ministry of Defence Awards Rolls-Royce $1.2 Billion in Sub Work originally appeared on Fool.com.

Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.