Two shipbuilders tendered for the contract –
VSEL and SwanHunter. On 11 May 1993, the government announced that VSEL had won the contract.
The build was to commercial standards, reducing costs significantly and leading to a construction spend of £154 million (£283 million in 2015). VSEL, a warship manufacturer, sub-contracted the build phase to the commercial Kværner yard in Govan Glasgow. The fact that VSEL's bid was £71 million lower than Swan Hunter's was the source of political controversy and led to a
National Audit Office investigation to determine whether the competition was fair. The report, published on 29 July 1993, stated that, although VSEL did subsidise its bid, the MoD was right to award the contract to VSEL because the subsidy was much smaller than the difference between the two bids; VSEL's bid was £139.5 million compared to Swan Hunter's £210.6 million.
The Times also suggested that the subsidy was as little as £10 million.
In anticipation of the report, the
Financial Times described the different philosophies adopted by the two bidders; while Swan Hunter viewed the ships as entirely military, "VSEL thought the design was basically a merchant ship with military hardware bolted on." VSEL's decision to sub-contract the build phase took advantage of lower overheads at a civilian yard as well as efficiency drives by its parent, Kværner.