Electro Optic Systems (ASX: EOS) share price is up nearly 5% today, after news of an agreement with the UAE broke this morning.
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The Electro Optic Systems (ASX: EOS) share price is on the move today, up by 4.6% to $5.23 per share at the time of writing. These gains come after news of an agreement with the United Arab Emirates (UAE) broke this morning.
While investors appear to be reacting differently, the news that the defence and technology company will produce weapons in the UAE has alarmed human rights advocates.
The latest news from Electro Optic Systems
The ABC reported this morning that Electro Optic signed an agreement with the UAE’s Tawazun Strategic Development Fund to produce a new high-tech weapon in the country last month.
The weapon is to be a chain-driven machine gun, designed to be lighter weight with improved accuracy, lower stoppage, reduced recoil and enhanced logistic support than weapons currently available.
The Australian Defence Department declined the ABC’s requests for comment on whether the deal complies with Australian treaty obligations.
Elaine Pearson, Australia director at Human Rights Watch, was quoted by the ABC:
No Australian company should be transferring weapons to the UAE.
Nor should they be engaging in joint ventures with UAE government agencies to manufacture weapons due to their involvement in laws of war violations in Yemen.
Electro Optic CEO Ben Greene was quoted by UAE’s state-run media publication Emirates News Agency as saying:
EOS’ global role as a systems integrator and technology leader in remotely operated combat systems will strongly support the development in UAE of enhanced defence technology products optimized for future roles in this global market.
EOS has a long history of investment in the UAE, and (this agreement) represents the next step in developing local industry and infrastructure to support next-generation defence and aerospace capabilities.
Electro Optic and the UAE
In 2019, the company was accused of providing weapons to Saudi Arabia and the UAE that were then used in Yemen, a conflict bounded by accusations of atrocities and human rights violations.
Electro Optic has stated that none of its weapons were deployed or used in the Yemen War. Ben Greene was quoted by the ABC in 2019 as saying there was “no end-user of Electro Optic System equipment that is likely to deploy it to Yemen”.
Electro Optic share price snapshot
The Electro Optic share price is currently sitting at $5.23, up nearly 5% on yesterday’s close. It’s down 2.61% over the last 12 months and 11% year to date.
Electro Optic has a market capitalisation of nearly $768 million, with approximately 149 million shares outstanding.
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The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Electro Optic Systems Holdings Limited. The Motley Fool Australia has recommended Electro Optic Systems Holdings Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.