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Finmeccanica Rebuilds Selex For Global Markets

KC-390The legal and ethical troubles that have enveloped Finmeccanica have, so far, left its electronics businesses largely untouched. That has allowed the company to continue with a major restructuring, formally completed in January, that has fused together three Selex-branded units into Selex Electronic Systems—Selex ES—that with 17,500 people and €3.5 billion ($4.6 billion) in sales is the single biggest unit in the €17 billion Italian company.

Now, Selex ES CEO Fabrizio Giulianini, in an interview at the LAAD defense show in Rio de Janeiro, says that the new unit can be a “world champion” in both its new and traditional markets, citing both existing businesses, such as fighter radars, along with new ventures like homeland security and cybersecurity, as places where it can expand.

While the former Selex companies were product-centric—Selex Galileo on sensors, Elsag on communications and Systemi Integrati on large-scale systems—Selex ES is divided into “customer-facing” divisions: airborne and space; land and naval; and a third unit, security and smart systems, that is primarily aimed at commercial, institutional and government non-military customers. “We needed to eliminate one of the issues that we had in the past, which was competition at the divisional level,” Giulianini says. Too often, Selex companies would find themselves on opposing teams. The new company will develop stronger central organizations for engineering and manufacturing, he says.

Giulianini expects that Selex ES will shut down some product lines “that may not be attractive to the market. We don’t plan to exit any specific business sector, but we have some duplication, and we need the resources to launch new products, such as cyber.”

The biggest single group of Selex employees is in Italy, but the company has 5,000 people in the U.K. and intends to become “more and more global” as traditional markets stagnate, Giulianini says. In a move reminiscent of BAE Systems’ multi-domicile strategy, Selex ES is targeting key markets with joint ventures and subsidiaries.

Brazil is one of these, Giulianini says, and the company just launched Selex ES do Brasil. Its initial task is to support radars on Brazilian systems such as the F-5BR (with Grifo) and the KC-390, which will be outfitted with a Gabbiano radar. “One of the biggest opportunities we are pursuing here is the F-X2 fighter,” Giulianini says. Saab’s JAS 39E contender includes Selex’s Raven ES-05 radar as well as the company’s Skyward-G infrared search-and-track (IRST) and identification friend-or-foe systems. Selex already has an agreement with AEL Sistemas—Brazil’s largest avionics supplier and an Elbit subsidiary—to support the Raven in-country if Gripen is selected.

Selex wants to bring its experience to bear on Brazil’s potentially huge SisGAAz (Blue Amazon Management System), a project to establish surveillance and security in Brazil’s littoral waters. “We understand the strategy, that these big projects will be awarded to local primes,” Giulianini states, “but what we have said to the Brazilian armed forces and industry is that Brazil is buying a lot of large programs”—not just SisGAAz, but the SisFron border security project and Prosuper warship program—“and that these need to be addressed in a coherent way.” Selex was the lead integrator for Italy’s ForzaNec digital army program, and “we have put our experience on the table,” Giulianini says. “We learned something from our mistakes.”

The company also chose LAAD for the announcement of its light intelligence, surveillance and reconnaissance system, comprising a compact version of the Atos mission system, Gabbiano radar and other sensors integrated on the Italian-developed Omasud Skycar light twin-engine aircraft. This “cross-division” project is seen as a solution for countries requiring surveillance over long coastlines or borders on a limited budget—the small, simple platform makes it possible to distribute the fleet around multiple bases. It is the company’s second air system announcement this year, following the disclosure of the Hammerhead project for an unmanned version of the Piaggio P180.

Other strategic markets are India and Saudi Arabia, where the foundation of the company’s presence is via the Tornado F3 and Typhoon, “We have €14 million on board each Typhoon,” Giulianini notes, including the radar, IRST and electronic warfare system, and Selex is supporting Typhoon campaigns in the United Arab Emirates, Malaysia and Kuwait.

The Selex CEO now sees the Captor-E active, electronically scanned array radar as a near-certainty for the Typhoon, and like some other Eurofighter participants detects a renewed ambition and determination among the partner governments to push the program forward. However, his view of the fighter’s chances in South Korea, an upcoming decision, is that “I would have been more optimistic a few weeks ago,” with the confrontation in the region now pointing to a U.S. order.

The new “security and smart systems” unit combines elements from the former Systemi Integrati and Elsag units, Giulianini says. Significant recent wins in this area include NATO’s Computer Incident Response Capability and a technology partner arrangement with Expo 2015 in Milan—the latter, a world fair focused on sustainable technology, will be set up as a small “smart city” with Selex providing security and information systems. The new Selex division is bidding for the event security role in the 2014 Glasgow Commonwealth games in Scotland.

Some of this work could flow back into aviation, Giulianini says, through the emerging idea of an “integrated airport” in which ground and air surveillance radar, air traffic management, ground movement control, baggage handling and security would be combined.

Author :  Bill Sweetman / Source: Aviation Week & Space Technology

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