Shares in BAE Systems (LON: BA.) climbed 1.2% on Wednesday after the defence contractor confirmed it had secured $16 million in Defense Production Act Title III funding from the US Department of War, boosting investor sentiment around the group’s growing space and microelectronics business.
The stock touched an intraday high of 2,037p before settling higher, with the FTSE 100 heavyweight trading at around 2,029p, up 23p on the previous close of 2,006p, as volumes topped 6.3 million shares.
The funding, awarded through the Department’s Warfighting Investments, Resourcing, and Execution directorate, will be used to demonstrate and qualify BAE Systems’ radiation-hardened 45-nanometre (RH45) technology.
The award reinstates the RH45 ASIC Storefront, a platform that has for more than a decade allowed space customers to design their own radiation-tolerant integrated circuits using proven manufacturing methods.
Manufacturing will be carried out on GlobalFoundries’ 45nm silicon-on-insulator process at its Malta, New York facility, reinforcing the domestic US supply chain for high-performance, radiation-hardened microelectronics used in defence, civil and commercial space missions.
Joe Dziezynski, Space Systems product line director at BAE Systems, said the RH45 library gives customers “a unique and trusted capability” to meet radiation-hardened requirements for the “challenging space environment.” GlobalFoundries’ Ezra Hall added that the investment “reaffirms our commitment to providing continuity of supply for critical defense applications.”
The RH45 technology is expected to feature in BAE Systems’ Endura single-board computers, destined for use by space agencies and spacecraft manufacturers. Work will be carried out at the company’s Manassas, Virginia facility, a designated US Department of War Category 1A Microelectronics Trusted Source.
The contract is one of five DPA Title III awards totalling $102.6 million issued this fiscal year, underscoring continued US government support for domestic defence-critical manufacturing capacity.