Defense Contractor Lockheed Martin Corp. (LMT) received Friday a $1.96 billion contract from the US Defense Missile Agency to supply two Terminal High Altitude Area Defense (THAAD) weapon systems to the United Arab Emirates under a Foreign Military Sale as well as provide additional maintenance and support equipment for it.
Bethesda, Maryland-based Lockheed Martin noted that this is the first Foreign Military Sale of the THAAD weapon system that includes interceptors, launchers and radar. The contract period for the supply and support extends over nearly five years from December 30, 2011 through June 30, 2016.
"Lockheed Martin is pleased the U.S. Government and the United Arab Emirates have reached an agreement on a path forward for the first Foreign Military Sale of the THAAD Weapon System," said Tom McGrath, vice president and program manager for THAAD at Lockheed Martin.
The weapon system is fully integrated and comprised of five major components: launchers, interceptors, a radar, THAAD fire control and communications (TFCC) units, and THAAD-specific support equipment.
THAAD is a key element of the Ballistic Missile Defense System (BMDS) that was primarily designed to defend U.S. troops, allied forces, population centers, and critical infrastructure. THAAD operates in a unique battle space intercepting both endo- and exo-atmospheric short-to-intermediate range ballistic missiles.
The contract was awarded to Lockheed Martin's Sunnyvale, California-based business unit, Lockheed Martin Space Systems Co. The company said the work will be managed in Sunnyvale, with the final assembly performed in its Pike county facility in Troy, Alabama. The launchers and fire control units are produced at the company's Camden, Arkansas facility.
Lockheed Martin is currently under contract for four THAAD batteries for the U.S. Army. It was awarded a contract for the delivery of the first two THAAD batteries for the U.S. Army in late 2006, with contracts for batteries three and four being awarded in 2010 and early 2011, respectively.
Earlier in the day, the Missile Defense Agency awarded a $3.48 billion Ground-based Midcourse Defense (GMD) Development and Sustainment Contract (DSC) to aerospace giant Boeing Co. (BA). The seven-year contract is the continuation of a contract it originally signed in 1998 and has held on to it since then. The Boeing led team that got the contract included defense contractor Northrop Grumman Corp. (NOC) also.
LMT closed Friday's regular trading session at $80.90, down $0.62 or 0.76% on a volume of 1.47 million shares, lower than the three-month average volume of 2.38 million shares.
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