MANUFACTURING TO CONTINUE ON LANDMARK SCOTSWOOD ROAD SITE

5th August 2013

Stephen Appleby, Head of Commercial & Procurement and David Bond, Managing Director Combat Vehicles (UK) of BAE Systems, John Reece, Chairman and Phil Kite, CEO of Reece Group

Stephen Appleby, Head of Commercial & Procurement and David Bond, Managing Director Combat Vehicles (UK) of BAE Systems, John Reece, Chairman and Phil Kite, CEO of Reece Group

The Reece Group is pleased to announce that it has completed the purchase of the BAE Systems, Scotswood Road manufacturing facility.

The group is one of the leading North East engineering businesses with over 500 permanent employees and operates in the defence, subsea, construction and, oil and gas markets.

In addition to transferring a number of its existing businesses to the new site, plans for the site include the creation of a fabrication and machining capability for large steel and aluminium products and the establishment of a research and development centre for developing engineered products for the oil, gas and subsea markets.

The Reece Group includes Pearson Engineering which designs and manufactures a range of counter mine and counter IED products, as well as combat engineering equipment for global defence customers including BAE Systems.

More recently the group has been on the acquisition trail and in 2012 purchased Velocity UK Limited, a road repair business and Responsive Engineering Limited, which supplies machining and fabrication services to the oil and gas market.

John Reece, Chairman of the Reece Group, said: “We are delighted to have been selected by BAE Systems as purchaser of this landmark site.  It will be fully used as a manufacturing facility. We have also acquired plant and machinery no longer required by BAE Systems which will be used to support our activities in the oil and gas, and the subsea markets.

We believe that engineering and manufacturing still has a valid and prosperous future in the North East.  The Reece Group places great emphasis on research and development – our approach to product development will continue and our investment at Scotswood Road will include the establishment of the Reece Innovation Centre whose focus will be to design the Group’s next generation of innovative engineering products. To achieve this we will be looking to attract the best engineers from the region.

More poignantly for me personally is that the Reece Group will be located at the very site where my father, the late Dr Alan Reece, developed his enthusiasm for what he called “real engineering” in his first job as an apprentice for Vickers Armstrong.”

David Bond, Managing Director Combat Vehicles (UK) said: “I am pleased that the site has been purchased by the Reece Group, which has its roots firmly planted in the North East.  Reece Group will develop new areas of engineering excellence at the site.”

Commenting on the purchase, Phil Kite, CEO of Reece Group and a non-executive director of the EEF, the manufacturer’s organisation, said:  “As well as good news for the Reece Group, this is also good news for North East manufacturing. One of BAE Systems’ key objectives through the sale process was to ensure manufacturing on the Tyne had a bright future and through the selection process they looked for financially strong, growing engineering businesses, which would use the site for manufacturing, create jobs and support the local community. The Reece Group more than meets these requirements. Our core strategy is to create employment and wealth in the North East. The acquisition of the Scotswood Road site will enable us to continue to deliver on this objective.

As part of the acquisition deal the Reece Group is supporting the training fund set up by BAE Systems to assist its employees at Scotswood Road gain future employment in engineering.”