BAE to lose Washington veteran Linda Hudson

Linda Hudson, who made history as the first female boss of a major US defence contractor, is set to retire from BAE Systems.

Ms Hudson was was named chief executive and president of BAE's operations across the Atlantic in 2009. She was charged with keeping the US division's finances on a sound footing as fighting drew to a close in Afghanistan and the US started to shrink its defence budget.

BAE said yesterday that the former General Dynamics executive could retain the position and place on the board until the end of March next year, allowing plenty of time to find a replacement.

BAE's group chief executive Ian King said that Ms Hudson had been responsible for the "transformation" of the US operations, as she had been successful in "diversifying the company's portfolio of products and services". She will be missed in the nest of vipers that is Capitol Hill; she was recently described by a senior colleague as "sophisticated about what goes on in Washington".

However, Ms Hudson, together with Mr King and finance director Peter Lynas, were criticised for receiving multimillion pound bonuses last year, as they only qualified for them through a one-off tax rebate. Lee McIntire also quit as a non-executive director at BAE yesterday, due to concerns over the potential for perceived conflicts of interest. He runs CH2M Hill, an engineer bidding to run a £14bn budget Ministry of Defence agency that awards contracts to BAE.