(Bloomberg) -- The U.K. and Sweden have moved a step closer to jointly developing a future combat air system, allaying fears that Brexit may stifle cross-border cooperation in the defense industry.
Saab AB plans to create a new center in the U.K. by investing 50 million pounds ($63 million) initially, it said on Monday.
The new hub “emphasizes the importance” of the future combat air system (FCAS) and the U.K. to Saab, its chief executive, Micael Johansson, said.
Earlier this month, Johansson said it would be “a disaster” if Britain exited the European Union without a defense deal that gave companies such as Saab access to both markets, the Financial Times reported.
The decision to invest in Britain follows a memorandum of understanding between the Swedish and U.K. governments that was signed 12 months ago. The goal is to allow for better cooperation on technology and expertise regarding future combat air systems.
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