In the mid-1930s Major E. F. Stephen formed at Hanworth, Middlesex, a company originally titled British Klemm Aeroplane Company Ltd. to build under license the German Klemm L.25 two-seat lightweight sporting aircraft under the name B. K. Swallow. Also built six B.K.1 Eagle 1 three-seat cabin monoplanes, similar to Klemm L.32 but redesigned by G. A. Handasyde. A total of 22 B.A. Eagle 2s was subsequently built.
The British-built version, known as the BK (British Klemm) Swallow, first flew in 1933. The firm changed its name to The British Aircraft Manufacturing Co Ltd in 1935.