Nigeria: South African Arms Manufacturing Group Envisages new Plans for Kaduna Factory

Lagos The Guardian on Sunday -February 11, 2001

Article by Madu Onuorah

SOUTH Africa's arms manufacturing giant-Denel Pty Ltd.- is set to take
control of Nigeria's fledgling arms company in the Defence Industries
Corporation of Nigeria (DICON.)

Although details of the South African company's interest is yet to be
finally worked out, officials of Denel Group and Ministry of Defence
are upbeat about the proposed buy-out.

Already, officials of the Ministry of Defence and DICON led by Minister
of State for Defence (Navy), Mrs. Modupe Adelaja, had visited Denel
Group facilities in South Africa. Also, Denel officials have visited
DICON factories and facilities in Kaduna.

DICON, established in 1964 to meet the nations defence needs has been
mirred in inactivity as most of its factories and facilities have been
out of production due to non-patronage of the corporation by
government.

Denel Group was established in April 1,1982 as part of the separation
and restructuring of the South African governments defence
manufacturing agency in Armscor. Under the arrangement, Denel controls
the manufacturing and production of elements of Armscor while Armscor
is now primarily an acquisition organisation for the South African
Defence Force (SADF). It is also the regulatory body for sales of
defence equipment and provision of technical and business support for
all its defence firms.

Ms Tand Molise, chairperson of the South African Parliamentary
Portfolio Committee on Defence, who was on a visit to DICON along with
other members of the committee told The Guardian On Sunday last week in
Kaduna that Denel is fully interested in becoming a part of the
resuscitation and management of DICON.

According to her, "Denel has been visiting Nigeria. It has a proposal
for injecting its experience and other facilities into the Nigerian
company. Part of the relationship expected out of the proposed deal
stems from Denels involvement in manufacturing of arms. Were interested
in DICON. Apart from this, there is also the need to start the
integration of Defence Industries in Africa."

She noted that for Africa to co-ordinate its peace-keeping efforts
effectively, "we'll start with standardisation of equipment, especially
with the two potential military and economic leaders in Africa."

Denel Pty Ltd, which has British Aerospace (BAe, a major military
aviation company as part owners) has 12 affiliate companies involved in
the manufacturing of military hardware ranging from arms and
ammunition, tanks, armoured personnel carriers, helicopters and other
aircraft.

Managed under five divisions in systems, manufacturing, Aerospace,
Informatics and Properties and Business Development ñ its subsidiaries
include Atlas Aviation, DENDEX, DINMAR, ELEPTRO, LIW, KENTRON,
MUSGRAVE, OTB, PMP, SOMCHEN and SWARKLIP.

It is expected that when the deal is sealed, Denels interest in DICON
will be managed by LIW, a division of Denels interest in DICON will be
managed by LIW, a division of Denels Systems Group involved in the
manufacture of handguns, assault rifles, machine guns, rapid fire guns,
mortars, armoured turrets, 155mm howitzer gun systems and commercial
products such as SL483 SKID STEER loader.

Classified as one of South Africas largest exporter of manufactured
goods, LIW offers first world technology and manufacturing expertise
that ranges from development and design to manufacturing and logistics
support.

The Guardian On Sunday learnt that Denels proposals which are under
wraps were submitted to the Ministry of Defence late last year. They
are being studied by both officials of the Ministry and DICON before
signing and implementation.

An official of DICON told the South African delegation that the
Nigerian arms company is happy with the final proposal from Denel
Group. Said he: "They (Denel Group) have been here. We've seen what
they were able to offer. They've been exposed to all our activities. We
are impressed with the facilities they have to offer. They submitted a
report which was received about a month ago. We've studied some of the
points and we want to clear some items before our final
recommendations." Established as purely arms and ammunition defence
organisation, DICON has a staff of 657 and operates its factory on 40
acres of land in Kaduna. It has also a factory in Bauchi for producing
APC and other military vehicles including a company for manufacturing
of propellants and explosives.

Its major revenue since the lull in its activities comes from its
investment in UNION-DICON, a salt making outfit, where it is the
largest indigenous institutional investor. It also produces furniture
on request.


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