A £250 million contract to provide the Royal Navy with an air missile defence system will safeguard 250 jobs.

The contract between the UK Ministry of Defence (MOD) and missile systems company MBDA, which has a base on Six Hills Way in Stevenage, was agreed on Monday.

The Sea Ceptor system, comprising the Common Anti-air Modular Missile (CAMM), will equip the Royal Navy from 2016 and will be used as the primary air defence system.

Keith Garden, deputy managing director for MBDA UK, said: “MBDA is delighted to receive this contract for the production of Sea Ceptor as the Royal Navy’s most modern air defence missile system.

“Here at Stevenage it means high value jobs are sustained in engineering and management roles, as well as the indirect contribution the business makes locally.

“These jobs will be working towards establishing the production line and supporting it as we prepare to deliver this system for the Type 23 and subsequently Type 26 frigates.”

The contract will directly sustain about 250 highly skilled technology jobs across MBDA and the UK-based supply chain, and about the same number again indirectly.

Defence secretary Philip Hammond said: “The production of Sea Ceptor will be a huge boost to the UK’s world-leading missile industry, providing hundreds of jobs, and once again proves our commitment to providing battle-winning technology to our Armed Forces.

“Having balanced the defence budget, we continue to order new equipment for our forces with confidence.”

The MOD will also stockpile the CAMM for a future planned land system.