Virtual reality emerges as key theme in defence deals in a year of slow deals growth
Deals activity by geography
Defence, aerospace and security industry deals, as captured by GlobalData, are up year-on-year (YoY) across most regions.
North America is leading in terms of deal value, but recorded moderate YoY growth in deals volume at 8%, with growth slightly lower in Europe at 6%. Asia-Pacific and South and Central America have seen higher YoY growth, with the volume of deals increasing 26% and 25% respectively.
The Middle East and Africa region is lagging behind others with a 19% drop in deals volume YoY and recording only $9.9m in deals value.
Deals activity by type
|Deal Type||Total deals value||Total deal count||YOY change (volume)|
A breakdown of deals by type and volume, as recorded by GlobalData, shows 5648% increase in mergers and a 71129% increase in partnerships year-on-year, while asset transactions are up 314% and acquisitions are down -86%.
Financing deals have increased across some types, with venture financing up 112% YoY, equity offerings up 219% and debt offerings up 139%. Private equity, however, has seen a drop of -86% in the number of deals YoY.
Deals activity by theme
GlobalData’s analysis of defence industry deals by theme shows that the volume of deals related to the internet of things (IoT), virtual and augmented reality (VR and AR), and artificial intelligence (AI) has increased between 2019 and 2020. VR and AR has been the fastest growing theme in deals tracked by GlobalData, with the volume of deals more than tripling from 2019 to 2020.
In terms of deal value, as indicated in the table below, IoT-themed deals tracked by GlobalData have fallen sharply, from $101bn in 2019 to $43.7bn in 2020. The value of VR and AR-related deals, meanwhile, has increased significantly, from $1.3bn in 2019 to $34bn in 2020, while AI has also seen some growth with the value of deals going up from $1.48m to $10.7bn in the period.
|Deals value by theme||2019||2020|
|Internet of things||$101bn||$43.7bn|
|VR and AR||$1.3bn||$34bn|
Note: All numbers as of 10 November 2020. For more insight and data, visit GlobalData's Aerospace, Defense & Security Intelligence Centre.
Latest deals in brief
BAE Systems and Meggitt sign deal for Typhoon radar equipment
BAE Systems has awarded Meggitt a £4.2m contract to supply nose radome technology for the Eurofighter Typhoon’s Multi-Function Array radar system. BAE Systems is working with Leonardo to equip some UK Typhoons with the new European Common Radar Systems Mk 2 (ECRS Mk 2), which gives the fighters the ability to locate, identify and suppress adversaries air defences. The radome developed by Meggitt protects instrumentation from environmental effects and prevents electromagnetic interference with the equipment.
Kongsberg and Pratt & Whitney sign contract for F-35 engine maintenance facility
Kongsberg Aviation Maintenance Services has signed a contract with Pratt & Whitney to open F-35 fighter aircraft engine maintenance facility at Norway. The site at Rygge will be one of five maintenance, repair, overhaul and upgrade facilities to be developed worldwide to enhance maintenance capabilities of the F135 engine that powers the F-35 aircraft. The contract covers the transition of the Kongsberg facility from activation and training to qualification and operations in order to achieve initial depot capability by the end of next year.
BAE Systems and University of Birmingham partner for advanced sensing technologies
BAE Systems has signed a partnership agreement with the University of Birmingham for the development of advanced sensing technologies. The resulting Advanced Sensing Technologies Consortium is part of the National Quantum Technologies programme, which is funded by the UK Government and seeks to support four technology hubs based in the UK.
Danish Defence and Fleet Complete partner to improve vehicle access
Danish Defence has partnered with global provider Fleet Complete to use its fleet management and carsharing solution. As part of this collaboration, 2,000 Danish Defence vehicles have been subscribed for the solution. The mobile reservation and carsharing app will improve access to vehicles for all defence staff members around the country. This will also allow assets to be used to conduct operations in a more economical and environmentally responsible manner.