LONDON (Reuters Breakingviews) - BOUNCE BACK. Babcock International’s bad news could have been worse. The British defence and aerospace contractor on Tuesday revealed a whooping 1.7 billion pound ($2.3 billion) charge after re-evaluating its contracts. Though that’s much higher than most analysts had expected, and exceeds the company’s market value, the majority is not in cash. Crucially, Chief Executive David Lockwood reckons he doesn’t need a rights issue to rebuild the balance sheet. Babcock shares promptly jumped more than 30%. Lockwood’s turnaround plan for the group which makes and services submarine equipment should give investors more hope. Removing management layers will cost 40 million pounds but save the same amount annually. Disposals are set to raise 400 million pounds, cutting net debt from a manageable 2.5 times EBITDA. Tuesday’s share bump goes some way to closing Babcock’s valuation discount to defence group BAE Systems. If Lockwood’s self-help plan succeeds, there could be more value up for grabs. (By Dasha Afanasieva)