BAE plans 1.6 bln placing to fund Armor deal

British defense contractor BAE Systems Plc said on Tuesday it planned a share placing to raise around 750 million pounds ($1.5 billion) to help fund its acquisition of U.S. Armor Holdings Inc.

BAE announced on Monday its plan to expand its share of the lucrative U.S. military market with a $4.1 billion deal to buy the U.S. body amour and army truck maker for $88 per share.

"The number of ordinary shares to be sold in the placing and the placing price will be decided at the close of the accelerated bookbuilding period," BAE said in a statement on Tuesday.

Europe's largest defense contractor -- which makes Typhoon jet fighters, Nimrod reconnaissance planes and nuclear-powered submarines -- is building up its military business after selling its stake in planemaker Airbus last year.

BAE already makes about 40 percent of its annual sales of almost 14 billion pounds in the United States. It ranks as eighth biggest Pentagon contractor, taking the lead role on $4.7 billion of awards last year and also undertakes major sub-contract work for other firms like Lockheed Martin Corp. and Northrop Grumman Corp..

BAE shares closed at 446 pence on Friday to value the business at 14.3 billion pounds. London markets were closed on Monday.
Source : http://investing.reuters.co.uk