SEVEN SA defence electronics companies have joined forces to form a consortium to manufacture combat suites valued at an estimated R2-billion for the Corvettes on order from the SANDF.

While the four naval vessels will be manufactured by an international armaments manufacturer - SA's preferred supplier is a consortium from Germany - most of the systems and communications contracts are expected to be awarded to local companies as part of the industrial participation component of the counter-trade deal.

In a bid to secure the business, Altech Defence Systems (a joint venture between local company Altech and French defence group Thomson-CSF), Futuristic Business Solutions, Grintek Avitronics, Grintek Electronics Systems, Reunert Defence ESD, and Denel subsidiaries Kentron and LIW have formed the Corvette Combat Suite Group to ensure that a competitive local combat suite is offered to the shipyards building the vessels.

Daniel Klein, assistant CE of Altech Defence Systems, says the group is in place with a formal agreement signed by the bulk of the companies.

He says the existing manufacturing facilities of the companies falling within the group will be used and the combat suites will use local technology backed by international companies.

Calling on the expertise of the companies that make up the group, it has the resources, experience and credibility to take responsibility for the combat suite component of the national strategic acquisition exercise.

Armscor, the SANDF's procurement agency, has backed the move, saying it is the industry's interest that the companies group together. Spin-offs will include a chance to show the international market what the SA defence industry has to offer and could lead to lucrative export opportunities. "Through the group the companies will grow, not only survive," says a spokesman.

Using SA expertise for the maritime combat and communications platforms also benefits SA in terms of the ongoing maintenance, logistic support and updates these new systems will require over their 20- to 30-year lifetime.

Zoli Kunene, chairman of the Aerospace and Maritime Industries Association, says European companies work together on a similar basis and the consolidation of the SA electronics and communications defence companies reflects the maturity of the local industry.

Government's acquisition of the Corvettes, worth over R6-billion, forms part of its potential R30-billion spending spree to refurbish SA's defence forces. Finalisation of the contracts with international suppliers could take six to nine months. Industrial participation on the Corvette deal alone is valued at R16-billion and could generate about 10 000 jobs.

With acknowledgement to Sherilee Bridge and the Sunday Times.