Naval Ship Management has finalized contract negotiations for the ANZAC Ship Group Maintenance Contract with Australia's Defense Materiel Organization.

The five-year deal for the long-range escort ships is worth around $467 million in total to NSM, a 50-50 joint venture between UGL and Babcock's Australian division, a statement from UGL said.

The contract allows for a 10-year extension based on performance. Under the contract, NSM will provide ship repair and maintenance services for the eight 360-foot-long Australian navy ANZAC frigates.

"The ANZAC GMC is an important win for UGL, reflecting the opportunities for growth in the defense sector and delivering further support to our stable, recurring revenue streams," UGL's Managing Director and Chief Executive Officer Richard Leupen said.

"Securing this award reflects the capabilities of NSM which combines the strength of UGL's asset management and maintenance capabilities in the defense sector and Babcock's international expertise in naval ship sustainment and class output management."

UGL, which has headquarters in Sydney, specializes in outsourced engineering, property services and asset management and maintenance. The company operates in 45 countries and focuses on the power, water, rail, resources, property, transport, communications and defense sectors.

Babcock CEO Peter Rogers welcomed the contract.

"We look forward to working with the Australian government and developing a long-term relationship as we support its plans to deliver a new, cost-efficient, integrated naval support solution," Rogers said.

The ships, built by AMECON in Australia, were commissioned from 1996-2001 and have the capability to carry Sikorsky S-70B-2 Seahawk helicopters.

Australian navy information notes that the ships' main armaments include a 127mm gun, a torpedo system and an MK41 vertical launch system for the Sea Sparrow missile, made by Raytheon and General Dynamics.

The ships, based on the Meko 200 frigate design from German shipbuilder company Blohm and Voss, have a range of around 6,000 nautical miles and a speed of 27 knots from a combined diesel-gas power plant.

The engines are a single General Electric LM2500-30 gas turbine and two MTU 12V1163 TB83 diesel engines.

The term ANZAC comes from the Australian and New Zealand army corps whose members fought at the battle of Gallipoli in the Dardanelles area of Ottoman Empire during World War I. The ANZAC forces, part of a larger British empire army that suffered a major defeat at Gallipoli at the hands of the Turkish army.