Pentagon Triples Size of Raytheon's Standard Missile Contract on Wednesday

The Department of Defense awarded only five defense contracts Wednesday, but with a combined value of $818.1 million, it packed a lot into them.

Publicly traded companies claimed only two of these contracts. Raytheon (NYSE: RTN  ) was the day's big winner, winning a sole-source modification to an undefinitized contract action to produce Standard Missile-3 Block IB missiles, first announced on Jan. 9, 2014. The modification adds up to $350.2 million to the value of the original award (which was $156 million), which funds will be used to pay Raytheon to produce additional SM-3IB missiles for the U.S. Missile Defense Agency. Delivery of all missiles is still due in September 2016.

The SM-3IB is a new version of Raytheon's venerable Standard surface-to-air missile, which aims to enhance the original Standard Missile's effectiveness with enhanced, two-color infrared target seeking, and the ability to use short bursts of precision propulsion to steer the missile toward incoming targets. The SM-3IB is scheduled to begin deployment in 2015.

The day's only other winner (among publicly traded companies) was Britain's BAE Systems (NASDAQOTH: BAESY  ) (LSE: BA  ) . BAE was awarded a $6.9 million contract modification to supply the U.S. Army with spare parts for self-propelled howitzers, and also with 18 ammunition carrier tracked vehicles. Delivery is due Sept. 30, 2015.


Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2865821, ~/Articles/ArticleHandler.aspx, 10/22/2014 10:39:59 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement