BAE Systems' chairman has said that he would support a full review of the Serious Fraud Office's abandoned investigation into the company's £43 billion arms deal with Saudi Arabia, in the belief that it would finally clear his company's name of any wrongdoing.

Dick Olver, the chairman of the UK's biggest defence manufacturer, said that a fresh look at the evidence would show there was no chance of bringing a successful prosecution and that ending the probe had been the right decision.

Mr Olver said that he was not asking for the case to be reopened but that he would be supportive of a case review, in which the SFO sought senior legal advice on whether it could mount a successful prosecution against his company.

Mr Olver told BBC Radio 4’s Today programme: “The courts have said ’well you can’t use that reason’ but what I am more concerned about is the case itself which I do believe should be abandoned but for a different reason ... because it is doomed to failure.”

The Law Lords found that “as far as they could tell there was indeed no evidence to say that this was anything other than a legal commission”, Mr Olver said.

“The new head of the SFO, at a time that is convenient for him, should assemble whatever QCs are needed, and I think they are, and do a case review. Not reopen the case — a case review to find out whether or not there really is a case that would have any chance of going anywhere in a court of law."

He added: "My belief is that the answer to that question is that there is no chance of it and that Lord Goldsmith was right in the first place.”.

The SFO abandoned its probe of the al-Yamamah deal with Saudi Arabia 18 months ago because of Government fears that it would threaten national security.

Ministers feared that continuing with the investigation would increase the risk of a terrorist outrage because Saudi Arabia was threatening to withdraw security cooperation.

Last month, the High Court ruled it was unlawful for the SFO to abandon the case on those grounds. Now, the SFO is appealing this decision in the House of Lords.

Yesterday, Lord Woolf published a report on the ethical standards of the UK firm saying that it did not pay sufficient attention to ethics in the past, leading to serious damage to its reputation.

Mr Olver has said that he is committed to implementing the 23 recommendations made by the former chief justice of England and Wales.

BAE Systems, which holds its annual meeting today in London, has still not revealed who will replace its chief executive Mike Turner, when he steps down from the role in August.

In a statement released before its annual meeting, BAE said that trading in the first four months of 2008 met expectations, leaving it set for a year of good growth with its large order book providing excellent forward visibility.

Europe’s biggest defence contractor said in a statement that it had been helped by additional US orders worth $800 million £400 million) for mine-protected vehicles.

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