Smiths Group to spend £400m on expanding detection business

Smiths Group, the international engineering company, said yesterday it could spend at least a further £400m expanding its fast-growing detection business, which specialises in equipment for detecting explosives and weapons in airline luggage and protecting troops from chemical and biological threats.

Smiths Group, the international engineering company, said yesterday it could spend at least a further £400m expanding its fast-growing detection business, which specialises in equipment for detecting explosives and weapons in airline luggage and protecting troops from chemical and biological threats.

Stephen Phipson, the group managing director of the division, said the business would increase sales by 25 per cent this year and that fresh acquisitions would be necessary to maintain that level of growth.

The company's biggest takeover so far has been the £240m purchase two years ago of Heimann Systems, a German manufacturer of X-ray equipment for detecting weapons, explosives and contraband. Further smaller acquisitions are in the pipeline.

The company's equipment is installed everywhere from the Pentagon and the White House to Heathrow airport and the Channel Tunnel. It is bidding in competition with BAE Systems and two US contractors for a $500m (£260m) contract from the Pentagon for up to 270,000 chemical agent detectors for the US Army. It is also bidding to supply America's Transportation Security Administration with new explosives detector booths which will eventually be installed at all US airports to screen passengers.

Another fast-growing market is Russia, where outrages such as the Beslan school siege have encouraged the authorities to spend hundreds of millions of pounds on detection equipment.

The global security market is worth about £70bn a year, of which detection systems account for about £7bn. Smiths Detection, with annual sales this year of £400m, accounts for only 6 per cent of that and yet it ranks among the world's top five suppliers.

Mr Phipson said that most detection equipment in use belonged in the "stone age" compared with the sophisticated technology being developed now.