Acquisition of 100% stake in the Saudi Economic Offset Program company will 
enable SAMI to accelerate its OEM-agnostic defense electronics aspirations

Saudi Arabian Military Industries (SAMI) today announced the signing of a Term 
Sheet Agreement to acquire 100 percent ownership in Advanced Electronics 
Company (AEC). The agreement signing took place at a Saudi Arabia – UK industry 
event in London in the presence of senior shareholder representatives, 
including His Excellency Ahmed Al-Khateeb, Chairman of SAMI, and Sir Roger 
Carr, Chairman of BAE Systems. 

SAMI's investment in AEC, the Riyadh-based private sector firm specializing in 
engineering, development, manufacturing, repair and technical support across 
defense, Information Communications Technology (ICT), energy, cybersecurity and 
high-tech fields, at the local, national, regional, and international levels, 
comes as part of SAMI's ongoing efforts aimed at increasing local defense 
manufacturing in the Kingdom, in line with the directives of the Saudi Vision 
2030. 

H.E. Ahmed Al-Khateeb, Chairman of SAMI, said: "The foundation for the 
institution and growth of SAMI was laid three years ago with the announcement 
of the Saudi Vision 2030. SAMI's journey began in 2017, and since then we have 
forged ahead with the backing of our country's leadership, steadfast efforts of 
our team and support of our partners. Today's agreement marks a significant 
milestone for us, as we advance our efforts to build a strong, dynamic and 
sustainable military industries sector in Saudi Arabia." 

H.E. Al-Khateeb added: "Defense electronics is a mission-critical element of 
the defense sector, and the acquisition of AEC firmly establishes SAMI's 
presence on the global defense industry map. Furthering our aspirations in the 
sector, it will help us drive local content and stimulate economic growth." 

Established in 1988 under the Saudi Economic Offset Program, and under the 
ownership of a number of companies, including international defense, aerospace 
and security company BAE Systems, AEC has played a pioneering role in the 
fields of modern electronics, manufacturing, system integration, and repair and 
maintenance services for nearly three decades, thereby becoming a major 
regional player renowned for innovation. AEC specializes in the design, 
development, manufacturing, maintenance and repair of several advanced industry 
and military electronic systems, devices and equipment such as smart 
electricity and water meter systems, security protection systems for the vital 
infrastructure, industrial control systems, sight systems for the Typhoon 
aircraft, jammer and interference systems for the F-15 aircraft, electronic 
units for the F-16 aircraft, land equipment and training simulators for the 
Hawk 165 aircraft, and sight systems for the Tornado aircraft, among others. 

AEC's evolutionary growth has seen the company play a key role in localizing 
military manufacturing, deploying smart technologies, and accelerating 
industrial and commercial growth, while maintaining a Saudization rate of over 
80% and 100% completion rate across more than 1,000 projects. AEC has developed 
its own framework, Aligned Integrated Methodology (AIM), which provides a 
standardized approach to governance and delivery, and comprises methodologies 
in Portfolio, Program and Project Management. 

Over the past few years, AEC has witnessed a steady growth in its sales year on 
year, with net sales in 2018 rising to SAR 2.07 billion, compared to SAR 1.925 
billion in 2017, and SAR 1.65 billion in 2016. 

Following the acquisition, AEC will form the core of establishing SAMI's 
original equipment manufacturer (OEM)-agnostic defense electronics and 
indigenous defense technology solutions business division, cutting across all 
of its business streams. In addition, SAMI's total number of employees will 
significantly increase to reach 2,200, as a result of the acquisition. 

In addition to facilitating Transfer of Technology (ToT), boosting local 
production, and deepening engineering, design, development, maintenance, 
repair, and overhaul (MRO) work, the acquisition will enable SAMI, through AEC, 
to develop its own mature products to help achieve its strategic goals set for 
the year 2030. 

Since its inception in mid-2017, SAMI has been leading Saudi Arabia's efforts 
in developing self-sufficient defense capabilities with its fast-growing 
portfolio of military products and services spanning four business divisions – 
Aeronautics, Land Systems, Weapons and Missiles, and Defense Electronics. 

About Saudi Arabian Military Industries (SAMI):
Launched in May 2017, Saudi Arabian Military Industries (SAMI) is a state-owned 
ýmilitary industries company working under the directives outlined in the 
ýSaudi Vision 2030. Aiming to be among the top 25 military industries companies 
in the ýworld by 2030, SAMI is expected to play a key role in localizing 50% of 
the Kingdom's ýtotal government military spending. 

SAMI is combining the latest technologies and the best national talents to 
develop ýmilitary products and services at par with international standards 
across four business ýdivisions – Aeronautics, Land Systems, Weapons and 
Missiles, and Defense Electronics. ýThe company is also focused on increasing 
exports and bringing foreign investment to ýthe Kingdom's military industries 
sector. 

Photo - https://mma.prnewswire.com/media/927858/SAMI_AEC.jpg 

SOURCE: SAMI