Launch of a Nakhoda Ragam class corvette at BAE’s Scotstoun Shipyard in Glasgow.

LONDON–U.K. defense company BAE Systems PLC (BA.LN) will likely close one of its shipyards, with a decision expected before Christmas, the Sunday Telegraph reports.

The report quotes Nigel Whitehead, BAE’s managing director of programs and support, as saying that BAE expected “a reduction in footprint,” putting its shipbuilding operations at Portsmouth, southern England, and its two bases in the Scottish city of Glasgow in the spotlight.

This is the strongest signal yet from BAE’s senior management that it will end shipbuilding at one yard and the first time it has put a timeframe on the decision, the report says.

“We will be making decisions this year, so we have a number of weeks in which to do that,” Mr. Whitehead is quoted as saying, adding that BAE was working closely with the Ministry of Defence.

The report also quotes unnamed industry insiders as saying that the Portsmouth shipyard is most at risk, with an estimated loss of up to 1,500 jobs.

A Ministry of Defence spokesman is quoted as saying the ministry will “continue to work closely with BAE.”

Full story: http://www.telegraph.co.uk/finance/newsbysector/industry/defence/9700890/Axe-looms-over-BAE-shipyards.html

(c) 2012 Dow Jones & Company, Inc.

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