Denel

Denel (Pty) Ltd

Type	Proprietary limited company
Industry	weapons manufacturing
Founded	1991
Headquarters	Centurion, Gauteng, South Africa
Area served	world wide
Key people	CEO: Talib Sadik[1]
Products	attack helicopters, guided missiles, glide bombs
Revenue	R3,268,1m
Net income	R541,1m (loss)
Employees	7634
Parent	100% state owned
Website	http://www.denel.co.za

Denel (Pty) Ltd is a South African state owned aerospace and defence technology conglomerate established in 1991. It was created when the manufacturing subsidiaries of Armscor were split off in order for Armscor to become the procurement agency for South African Defence Force (SADF), now known as the South African National Defence Force (SANDF), and the manufacturing divisions were grouped together under Denel (Pty) Ltd as divisions.

Denel was established as a state-owned industrial company under the Ministry of Public Enterprises in April 1992. It inherited most of Armscor's production and research facilities, and over 15 000 employees. At the time of its formation, Denel restructured and reorganised the former Armscor subsidiaries into a number of divisions and subsidiaries within five industrial groups: systems, manufacturing, aerospace, informatics, and properties and engineering services.^[2]

Denel has developed a number of notable products, such as:

• The Umkhonto vertical launched air defense missile.
• Mokopa tandem warhead anti-tank guided missile, with a range of 10km.
• Together with Gerald Bull, the G6 self-propelled howitzer and G5 towed howitzer, the longest ranged guns in their class worldwide, supported with base bleed, VLAP and the advanced fuzing technology.
• The 5th generation A-Darter air-to-air missile, currently in the final phases of development.

The Overberg Test Range is used for advanced aerial testing by NASA, EADS and BAE Systems to name a few.

Though Denel's market share is increasing, it still has not signed significant international contracts that will bring a real market return for its investments in development and research costs. In 2006, Denel signed a contract with the Finnish Navy for the Umkhonto air defence missile; this was a significant step, since it was the first significant sale to a western nation. The Swedish defense force was also interested in the Umkhonto missile, but due to budget constraints had to put their plan on hold.

Though Denel has comparable quality products, at lower prices, it has a continuous net loss on income and transition to democracy since 1994 is worrisome to buyers if the state will continue funding this loss. This might be the reason for Denel's most worrisome challenge, being the sale of the Rooivalk attack helicopter, which was developed at a cost of US$1billion and after the losing of a contract from Turkey for $2 billion and other countries only mentioning interest, but no contract coming forth. The sale of the Rooivalk, which could be Denel's most profitable project, also threatens to be its largest loss ever.^[3]

Divisions

The following divisions form part of Denel (Pty) Ltd

• Denel Aviation
• Denel Dynamics
• Denel Land Systems
• Denel Personnel Solutions
• Denel PMP
• Denel SAAB Aerostructures
• Integrated Systems Solutions
• Mechem
• Overberg Test Range

Associated companies

• Carl Zeiss Optronics
• Rheinmetall Denel Munition
• Turbomeca Africa

References

1. ^ http://www.denel.co.za/uploads/docs/20080926appointment_of_group_chief_executive_officer.pdf
2. ^ "Conversion: The Case of Denel". Peter Batchelor (International Development Research Centre). 2006-11-26. http://www.idrc.ca/fr/ev-68072-201-1-DO_TOPIC.html. 
3. ^ "What went wrong with Rooivalk?". http://www.engineeringnews.co.za/article.php?a_id=110041. 

External links

• Denel (Pty) Ltd
• Denel Dynamics
• Denel Land Systems
• Carl Zeiss Optronics
• Overberg Test Range
• Pretoria Metal Pressings
• Mechem
• DPS
• Denel's R500m garage sale
• Houwteq - a discontinued division of Denel