CANBERRA - Australian Navy on Wednesday said it will buy a near-new navy amphibious landing ship from United Kingdom to help overcome its lack of heavy transport ships.

According to Defense Minister Stephen Smith, Australia had been successful in its bid for RFA Largs Bay, a 16,000 tonne landing ship launched in 2003 and commissioned in 2006.

The ship is set to be decommissioned as a cost saving measure under the United Kingdom government's Strategic Defense and Security Review released last October.

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Smith said Australia would pay US$103 million at the current exchange rate for the Largs Bay. He added that the book value was around 130 million British pounds (US$210 million).

"So we believe it is very good value for money," he told Australia Associated Press on Wednesday.

The new vessel is expected to arrive in Australia at the end of the year and be ready for operations early 2012, providing the navy with a much-needed amphibious heavy lift capability.

Smith said the arrival of Largs Bay would allow defense to proceed with a comprehensive plan for amphibious lift capability before the arrival of the new large landing ships HMAS Canberra and HMAS Adelaide around mid-decade.

In the meantime, Australia will share use of the New Zealand navy landing ship HMNZS Canterbury, as Australian landing ship HMAS Tobruk undergoes much-needed maintenance.

"We are now looking very closely at the possibility of further acquisitions or leases of commercial amphibious vessels, whether catamarans or trimarans, to ensure that we have appropriate transitional arrangements," Smith said.