Thales Group


Thales Group is a French multinational company that designs and builds electrical systems and provides services for the aerospace, defence, transportation and security markets. The company is headquartered in Paris' business district, La Défense and its stock is listed on the Euronext Paris.
The company changed its name to Thales from Thomson-CSF in December 2000 shortly after the acquisition of Racal Electronics plc, a UK defence electronics group. It is partially state-owned by the French government, and has operations in more than 56 countries. It has 80,000 employees and generated €18.4 billion in revenues in 2019. As of 2017, it is also the 8th largest defence contractor in the world and 55% of its total sales are military sales.
The CEO of Thales Group is Patrice Caine since December 2014.

History

Thales' predecessor, Thomson-CSF, evolved from Compagnie Française Thomson-Houston, which was established in 1893. However Thomson-CSF itself was established in 1968 when Thomson-Brandt merged its electronics arm with that of Compagnie générale de la télégraphie sans fil.
Thales formed a joint venture with Raytheon in June 2001 to combine their radar and communications systems divisions. Named ThalesRaytheonSystems, the firm is 50% owned by both parent companies. The joint venture was restructured in 2016 to switch focus exclusively on NATO agencies and NATO member states.
In 2002 Thales set up the joint venture company Armaris with the French shipbuilder DCN to offer a total "bottom up" shipbuilding capability.
In 2002, Thales Broadcast Multimedia, a former subsidiary of Thales, provided China with standard short-wave radio-broadcasting equipment designed for general public radio broadcasting. Although the contract was not at all for the purpose of jamming foreign radio stations broadcasting to China, it now appears that this is what the ALLISS antennas are being used for.
In 2003 Thales UK's design won the competition for the Royal Navy Future Carrier and the company now participates in an alliance company with BAE Systems and the UK Ministry of Defence.
Thales Navigation, a division that produced GPS units, was sold to private equity group Shah Capital Partners in 2006 for $170 million and renamed Magellan.

Acquisitions

In 2006 Thales acquired Australian Defence Industries, a major manufacturer of military equipment such as smokeless gunpowder and the Bushmaster IMV.
In April 2006, Thales announced it would be acquiring Alcatel's space business, and Alcatel's Rail Signalling Solutions division in a deal which also raised Alcatel's ownership of Thales to 21.66 percent. The French government would also decrease its ownership in Thales to 27.1 percent from 31.3 percent as part of the acquisition. The deal would also include the Systems Integration activities. In January 2007, the 1.7 billion Euro deal was approved.
In 2008, Thales acquired British Hardware security module vendor nCipher.
In December 2008, Alcatel agreed to sell a 20.8% stake in French engineering group Thales SA to Dassault Aviation SA for €1.57 billion.
In 2014, Alcatel-Lucent initiated talks to sell its cybersecurity unit to Thales. The deal was signed in October that year.
In 2016, Thales acquired Vormetric, a data security company, for $400M.
In 2017 it acquired Guavus and bid €4.76B for digital security company Gemalto.
In 2018 Thales committed to divesting nCipher as condition for its acquisition of Gemalto; in June 2019 it divested nCipher to Entrust Datacard.

Ownership

As of 31 December 2014, Thales Group was owned 26.4% by the Government of France, 25.3% by Dassault Aviation, and 48.3% float, including employee share ownership of 2%.

Operations

Thales Group supplies electronic devices and equipment used by the French Armed Forces from its past as Thomson-CSF, including the SPECTRA helmet for the army and the gendarmerie. It has worked with Dassault Aviation on the Rafale and made its SPECTRA defensive aids. Thales often worked with DCNS and designed the electronics used on French ships, and it is involved in the construction of both the Horizon and FREMM programs. Thales, as Thomson-CSF, was involved in the Taiwan frigates scandal, relating to the sale of La Fayette class frigates to Taiwan.
It is also present in Eurosam as Thomson-CSF was a founder of the consortium along Aérospatiale and Alenia Aeronautica. In February 2004, Thales was awarded a contract for a new command and control system for the French Navy, the SIC 21, that will be fitted on the Charles de Gaulle, many vessels and shore locations.
Additionally, the initially planned French aircraft carrier PA2 involved Thales as the main designer of the ship. However, the project was cancelled in 2013.
Thales is also working on X-ray imaging, finances, energy and operating commercial satellites.
By 2012 the company is mainly composed of five branches: Defense, Security, Space, Aerospace and Ground transportation.
Among the EU supported projects Thales participates in are:
The company's design won the competition for the Royal Navy Future Carrier. It is part of the AirTanker consortium, the winning bid for the RAF's Future Strategic Tanker Aircraft. Thales UK won the contract for the British Army UAV programme, Watchkeeper. It also produces the SWARM remote weapon station. Thales simulators include full motion devices as well as flat panel and other training facilities.
Thales Air Defence produces a range of short-range missile systems such as the Starstreak surface-to-air missile.

Aerospace

The Thales ATM solution is marketed under the name "TopSky", previously named "EuroCat". Thales supplies avionics to civil aircraft manufacturers, including Fly-By-Wire systems, cockpit systems, navigation computers, satellite communication, inflight entertainment and electrical systems.
In November 2017, Thales acquired a UK radar provider called Aveillant who produces software-defined holographic radar technology, which is able to detect small targets such as drones.
In February 2018, Thales won on a A$1.2 billion contract with Airservices Australia and the Australian Department of Defence to unify Australia's civil and military airspace under a single air traffic control system, named "OneSKY".

Ground transportation

Thales has major involvement in the UK rail industry as a result of the Racal merger and the 2006 acquisition of Alcatel's Rail Signalling Solutions division and transport business. Thales is to modernize 40 per cent of London Tube network London Underground.
In Denmark, Thales now owns 100% the "East-west Consortium" contracted for a country-wide travel card..
In India, Thales was selected in December 2014 by the New Delhi Metro Rail Corporation to deliver a completely automatic fare collection system, as well as ticketing equipment. Thales has also been contracted by Hyderabad Metro Rail since 2017 to provide train control automation and communication services for the metro in Hyderabad.
In 2014, the company was tasked with equipping the public transport system of Bordeaux, France, with a contactless ticketing and revenue collection system, to be installed by February 2017. However, due to delays, the system is not expected to be operational until 2019.
In Singapore, Thales was involved in a train collision resulting from a compatibility issue between the old signalling system's interface, and the new one. The accident resulted in 38 minor injuries. A similar incident would occur in March 2019 in Hong Kong on the Tsuen Wan line.
In Vietnam, the company was awarded a €265 million contract in 2017 to deliver the telecommunications system for the currently constructed Line 3 of the Hanoi metro. Running behind schedule by one year, the metro line is slated to be launched in 2023.
In Turkey, the Thales team has delivered the first High Speed Line in the country in 2009, and has completed more than 400 km of the Ankara Istanbul High Speed Line.

Other activities

Thales is also a major manufacturer of in-flight entertainment systems on board airliners. Thales' primary competitors in this area of business include Panasonic Avionics Corporation, Rockwell Collins, and LiveTV.
Thales also produces and installs ticketing and communications systems for public transportation via its ticketing and revenue collection division. In November 2016, Thales announced its intention to divest from its transport ticketing, revenue collection, road toll and car park management business. The company entered into negotiations with Paris-based Latour Capital, but the negotiations ended in 2017 after Latour Capital announced this business was "not aligned closely enough with its investment priorities." After subsequent talks with Chinese investors failed, Thales abandoned the divestment.

Thales international

Thales' international subsidiaries generated 52% of the company's revenue in 2008, with Thales UK being the largest of these accounting for 13% of group revenue. Its large presence in the UK has resulted in several high-profile contracts.
Thales has offices in:
As of June 2019, Thales' major shareholders are the French state and Dassault Aviation.

Controversies

Bordeaux project mismanagement

Although the ticketing system in Bordeaux was originally due for launch in summer 2017, multiple delays have pushed the new launch date back by 20 months to 2019. The project's many setbacks are considered to reflect negatively on the city's reputation, with Bordeaux's city's mayor and former French prime minister Alain Juppé, calling Thales' inability to meet its commitments "unacceptable behaviour."

Centralised slush fund

Michel Josserand, former head of THEC, a subsidiary of Thales, and Dominique Monleau, alleged that Thales has a centralised slush fund that it uses to bribe officials.

ANC

, the financial advisor to the president of the African National Congress party Jacob Zuma, was found guilty of organising a bribe on behalf of Thomson-CSF.

World Bank

In 2004 the World Bank's Integrity Unit blacklisted Thales from any of the World Bank's projects for one year because of its fraudulent practices in a US$6.9 million contract for the supply and maintenance of motorcycles in Cambodia.

Taiwanese naval order

Around 1991-1993, French state owned Elf Aquitaine was involved in selling frigates to Taiwan. On June 10, 2011 Thales Group and the French Government were ordered to pay 630 million euros in fines after the courts heard that bribes had been paid to the Taiwanese government to win this large naval contract. Part of the responsibility was transferred to Thales Group because it held the legacy from Thomson-CSF. To this day, this is the largest corruption case in French history.

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