Pentagon Issues $62.6 Million in Contracts

Department of Defense contract officers on Tuesday announced a total of 13 contract awards worth more than $1 billion in aggregate. Notable winners among publicly traded companies included several Army contract awards, including:

  • Britain's BAE Systems' (NASDAQOTH: BAESY  ) Land and Armaments division won a $28.7 million modification to a previously awarded contract to supply M88A2 heavy equipment recovery combat utility lift and evacuation system vehicles to the U.S. Army. Work on the contract should be complete by March 31, 2014.
  • Raytheon's (NYSE: RTN  ) Thales Raytheon Systems joint venture was awarded a $23.1 million modification to a previously awarded contract to supply Sentinel Mode 5 Identification Friend or Foe kits, and spares, to the Army.
  • Caterpillar (NYSE: CAT  ) , while not ordinarily considered a defense contactor, seems particularly well-suited for the contract it won -- a $10.8 million award to support Army Deployable Universal Combat Earthmover vehicles. Called "DEUCE" for short, these are essentially Army tractors, and so far the Army has ordered $67.1 million of them from Caterpillar under this contract.

In addition to the new awards, the Pentagon also issued contract modifications to both BAE and to General Dynamics (NYSE: GD  ) on a pair of contracts to the effect that both firms are being given an additional six months to develop new prototype ground combat vehicles that the Army is considering as replacements¬†for its existing armored personnel carrier fleet. The value of GD's development contract on this project is said to have a maximum value of $180.4 million, while BAE's development contract maxes out at $159.5 million.


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