June 29 (Bloomberg) -- Saab AB agreed to buy the Swedish marine defense unit of ThyssenKrupp AG for 340 million kronor ($50 million), expanding its business to manufacturing submarines and stealth-technology corvettes.
“An important task is to achieve synergies with Saab’s existing marine activities,” the Stockholm-based maker of Gripen jet fighters said in a statement. “This work must take its course while starting delivery of development, maintenance and products to the Swedish market.”
The takeover is the result of a long-standing disagreement between Essen, Germany-based ThyssenKrupp and Sweden’s defense materials agency, FMV. After Saab recruited engineers from ThyssenKrupp’s Swedish shipyard, the German steelmaker agreed to begin negotiating a sale of the unit, formerly known as Kockums, in April. The unit has generated substantial losses for years, ThyssenKrupp said in a separate statement.
Earlier this month, Sweden’s government and the main opposition party agreed to work to secure continued production of submarines and warships in Sweden and to promote Saab’s purchase the unit from ThyssenKrupp to return the shipyard in Karlskrona to Swedish hands.
Saab’s new marine unit got its first business on June 9, when it signed a letter of intent with FMV on contracts worth a total of about 11.7 billion kronor for two new submarines and upgrades of two vessels currently in service. On the international submarine market, the Saab-built A26 will compete with ships from ThyssenKrupp’s HDW, which makes the Type 214 diesel-electric sub.