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Denel

Denel SOC Ltd is a South African state-owned aerospace and defence technology conglomerate established in 1991. It was created when the manufacturing subsidiaries of Armscor were split off in order for Armscor to become the procurement agency for South African Defence Force ( SADF), now known as the South African National Defence Force ( SANDF), and the manufacturing divisions were grouped together under Denel as divisions.

Denel was established as a state-owned industrial company under the Ministry of Public Enterprises in April 1992. It inherited most of Armscor's production and research facilities, and over 15,000 employees. At the time of its formation, Denel restructured and reorganised the former Armscor subsidiaries into a number of divisions and subsidiaries within five industrial groups: systems, manufacturing, aerospace, informatics, and properties and engineering services.

Denel has developed a number of notable products, such as:

  • The Umkhonto vertical launched air defence missile.
  • Mokopa tandem warhead anti-tank guided missile, with a range of 10 km.
  • Together with Gerald Bull, the G6 self-propelled howitzer and G5 towed howitzer, the longest ranged guns in their class worldwide, supported with base bleed, VLAP and the advanced fuzing technology.
  • The 5th generation A-Darter air-to-air missile, currently in the final phases of development.

The Overberg Test Range is used for advanced aerial testing of missiles by Denel and other clients such as NASA, EADS and BAE Systems.

Though Denel's market share is increasing, it still has not signed significant international contracts that will bring a real market return for its investments in development and research costs. In 2006, Denel signed a contract with the Finnish Navy for the Umkhonto air defence missile; this was a significant step, since it was the first significant sale to a western nation. The Swedish defense force was also interested in the Umkhonto missile, but due to budget constraints had to put their plan on hold.

Though Denel has comparable quality products, at lower prices, it has struggled to attract buyers, with the Rooivalk attack helicopter being a prime example of this. After being developed at a cost of R1 billion, no sales were made as the contract from Turkey for $2 billion was lost. The sale of the Rooivalk, which could be Denel's most profitable project, also threatens to be its largest loss ever.