On Thursday, the Department of Defense announced that it has awarded a $30.2 million "sole-source-cost-plus-incentive-fee/cost-plus-award-fee contract modification" to Lockheed Martin's (NYSE:LMT) Mission Systems and Sensors division.
The contract being "modified" in this amount relates to Lockheed's pre-existing work on the Aegis Ballistic Missile Defense Baseline 4.0.1 Weapon System (Aegis BMD) -- a long-term contract already valued at upwards of $1.2 billion. (The new modification takes it across the $1.3 billion threshold).
Aegis BMD is an upgrade of the original Aegis air-defense system, integrating Lockheed's AN/SPY-1 radar and MK 41 Vertical Launching System, with Raytheon's (NYSE:RTN) Standard Missile-3 to create a ship-based defense that can target not only incoming cruise missiles and planes, but also ballistic missiles.
The modification instructs Lockheed to install and test Aegis BMD on three of the Navy's guided missile destroyers, and sets a completion date of March 15, 2015.