SABRE has the potential to provide efficient air-breathing thrust from standstill on the runway to speeds above five times the speed of sound in the atmosphere. The SABRE engine can then transition to a rocket mode of operation allowing spaceflight at up to orbital velocity—equivalent to twenty five times the speed of sound. Through its ability to breathe air from the atmosphere, SABRE offers a significant reduction in propellant consumption and weight compared to conventional rocket engines which have to carry their own oxygen.

A key element of the SABRE engine is a breakthrough in aerospace engine technology Reaction Engines has achieved by developing ultra-lightweight heat exchangers that allow the cooling of very hot airstreams from more than 1,000 °C to minus 150 °C in less than 1/100^th of a second whilst preventing the formation of ice at sub-zero temperatures.

Reaction Engines Ltd has an ongoing SABRE engine technology development programme and in 2013 the UK Government announced a £60-million (US$93 million) commitment to aid preparations for the design, manufacture and testing of SABRE demonstrator engines.

The viability of the SABRE engine has been independently validated by the European Space Agency during a review undertaken at the request of the UK government.

Under the terms of the agreement, BAE Systems will invest £20.6 million (US$32 million) in Reaction Engines to acquire 20% of its share capital and also enter into a working partner relationship. The working partnership will draw on BAE Systems’ extensive aerospace technology development and project management expertise and will provide Reaction Engines with access to industrial, technical and capital resources to progress towards the demonstration of a ground based engine--- a key milestone in the development of the technology.

Under the agreement BAE Systems will enter into a preferred supplier relationship with Reaction Engines in certain agreed areas and will have representation on the board of Reaction Engines.