A new report from Sky News highlights a developing situation regarding the potential acquisition of a major South American missile manufacturer, Avibras, by an Australian company. The report details a race between Australian firm DefendTex and Chinese state-owned defense giant Norinco to secure ownership of the financially troubled Brazilian company.
Avibras, CC BY-SA 4.0, via Wikimedia Commons
Australian defense company DefendTex, led by CEO Travis Reddy, has been in negotiations to purchase Avibras. Finalizing the roughly $200 million deal hinges on a $70 million loan from Export Finance Australia (EFA). DefendTex argues acquiring Avibras would offer significant benefits for Australia, including access to advanced missile technology, potential domestic production of rockets and missiles for the Australian Defence Force (ADF), and creation of local jobs.
The potential acquisition by DefendTex faces a serious challenge from China’s Norinco. This aggressive move by China has raised national security concerns in Australia, with experts fearing China’s potential acquisition of Avibras could provide them with advanced guidance systems and intellectual property for long-range coastal strike weapons.
DefendTex has expresses frustration with the Australian government’s slow response to their request for financial support. CEO Reddy reportedly has been unable to secure meetings with key government officials, despite repeated attempts. This hesitation seems to contradict the government’s stated intention to develop its own guided weapons program in collaboration with the US defense industry.
Critics, like former Senator Rex Patrick, argue that failing to secure Avibras leaves Australia overly reliant on the United States for defense needs and vulnerable if there are issues with U.S. defense acquisition programs. Australia risks losing a valuable opportunity to bolster its defense capabilities and technological independence, potentially allowing a competitor like China to gain access to critical missile technology.
Faced with a lack of government support, DefendTex is now reportedly exploring alternative funding options from European nations. Partnering with a European company could provide DefendTex with the necessary capital to compete with Norinco’s bid.
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