Raytheon Wins $574 Million Canadian Contract To Upgrade Naval Defense Systems

The Canadian Ministry of National Defence announced last Friday it awarded Raytheon [RTN] a $574 million contract to upgrade and support 21 Close-In Weapons Systems (CIWS) for the Royal Canadian Navy.

The CIWS is a rapid-fire radar-guided gun system that protects naval vessels against close in threats like missiles, aircraft, and small ships. It is currently installed on Canada’s 12 Halifax-class frigates and is planned to be installed on the Protecteur-class joint support ships after they are built. The first Protecteur-class ship is expected to be delivered and operational by 2021.

An MK 15 Baseline 2 Phalanx close-in weapon system (CIWS). Photo: U.S. Navy

An MK 15 Baseline 2 Phalanx close-in weapon system (CIWS). Photo: U.S. Navy

The Defence Minister, Harjit Sajjan, noted the CIWS work is expected to help protect Canadian naval vessels for up to two decades and create or maintain over 450 jobs in Canada.

“Today’s announcement is aligned with the goals we set out in 'Strong, Secure, Engaged' – we are making strategic investments in the Royal Canadian Navy that will help protect our sailors as they conduct the full spectrum of operations in a modern security environment,” Sajjan said in a statement.

"Strong, Secure, Engaged" is the title of Canada’s most recent official defense policy.

The in-service support contract runs through late 2037 and includes an initial 10-year service period with three option periods lasting five, three, and two years, respectively.

Navdeep Bains, minister of Innovation, Science and Economic Development underscored that under the contract Raytheon will make “important investments in Canada” supporting well-paying jobs “and help spur innovation across the country in small and medium enterprises. That’s how we ensure innovation works for all Canadians.”

Raytheon’s Canadian subsidiary committed to investing in small and medium-sized Canadian enterprises as well as research and development activities under the contract, the ministry said.

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