Newspaper says Britain's sole major shipbuilding company is on track

The Times newspaper reports that BAE Systems and the VT Group have provisionally agreed the ownership structure of a new shipbuilding venture formed from the merger of their respective shipbuilding operations.

The paper says they understand BAE Systems would have majority ownership at 55 percent.

They also say that Sir John Parker, the chairman of National Grid Transco, a shipbuilder by training, has been asked to head the new group.

Although BAE will have greater ownership the paper says that it believes voting rights will be evenly shared between the two giants.

In effect this marriage will result in Britain having one major shipbuilder, with shipyards on the Clyde and at Portsmouth. The Barrow shipyard is understood not to be part of the new venture.

The government has long sought a merger of the UK's shipbuilders to pool resources and become a champion player to win export orders.

Recently it was reported that BAE and Saudi Arabia were close to a deal on exports of the Type 45 destroyer. VT Group are major players on the market for smaller offshore patrol vessels.

With this merger the Clyde yards face yet another upheaval in their organisation. Recently they were part of a restructure into a venture called Surface Fleet Solutions, following on the heels of their formation as BAE Systems Naval Ships.

BAE Systems have so far not commented on the Times' revelation except to say details had yet to be finalised.