INTERNAL REVENUE SERVICE said that General Motors' spinoff and sale of the defense business of Hughes to Raytheon would be tax free, GM said yesterday. The transaction must be approved by GM and Raytheon stockholders and pass an antitrust investigation. The GM stockholder vote will come in the fourth quarter of 1997. GM stockholders will hold 30% of Raytheon's stock after the deal closes.
EDS signed a five-year, $35 million contract to take over the Computer Unit of Israel Military Industry (IMI). EDS, making the announcement yesterday, called it the first significant outsourcing deal awarded in Israel. The Plano, Tex., company will convert information systems running on a mainframe in IMI's Central Computer Unit to several systems supporting IMI's individual business units, including financial systems, marketing and sales systems, wages and human resources systems and a data warehouse system.
RANDALL LINCOLN, director of worldwide OEM sales and marketing for AlliedSignal Commercial Avionics Systems, Lenexa, Kan., was appointed publisher of Business&Commercial Aviation magazine and A/C FLYER, effective Aug. 3. Lincoln succeeds David Ewald, who has been associated with B/CA since it was founded in 1958, most of that time as publisher. Lincoln will report to Kenneth Gazzola, executive VP of The McGraw-Hill Companies Aviation Week Group, who said Ewald will continue with the magazine for the foreseeable future, as an employee and later as a consultant.
The Senate, despite objections of Defense Secretary William Cohen, approved an amendment to make the Chief of the National Guard Bureau a member of the Joint Chiefs of Staff. The amendment, introduced by Sen. Ted Stevens (R-Alaska) and co- sponsored by a large number of Senators, passed on a voice vote Friday.
McDonnell Douglas Corp. has won a $22 million U.S. Air Force contract for work on the Air Superiority Missile Technology program, an effort to develop new technology for air-to-air missiles. The five-year contract, awarded last month, calls for MDC to design, develop and demonstrate an advanced flight control system to support a missile with beyond-visual-range as well as close combat capabilities, the company said.
THE EUROPEAN COMMISSION wants concessions from Boeing by this morning, or it will reject the company's planned acquisition of McDonnell Douglas on July 23. EU sources claimed yesterday it was vital to reach an agreement as soon as Tuesday morning in order to abide by the EU's merger control rules. EC officials and Boeing representatives have been negotiating since Friday in Brussels.
The U.S. Air Force is opposing a Senate measure to cap the cost of the F-22 fighter production program at $43 billion. The Senate on Friday included language in its $268.2 billion fiscal 1998 defense authorization bill to limit spending on the program. An amendment by Sen. Dale Bumpers (D-Ark.) to keep production funding to $43 billion was passed by voice vote.
July 8, 1997 Northrop Grumman Corp. Northrop Grumman Corp., Melbourne, Fla., is being awarded an $8,895,108 face value increase to a firm fixed price contract to definitize the Lot IV Production Configuration Update Effort for two E-8C Joint Surveillance Target Attack Radar System (Joint STARS) aircraft. Contract is expected to be completed October 1999. Contract funds will not expire at the end of the current fiscal year. Electronic Systems Center, Hanscom AFB, Mass., is the contracting activity (F19628-95/C-0169, PZ0007).
German Finance Minister Theo Waigel formally, if reluctantly, approved about $1 billion as Germany's share of the production investment phase of the Eurofighter Friday, joining the U.K., Italy and Spain, which had previously approved funding. The dispute between the German defense and finance ministries over their shares of the next stage of the Eurofighter, which threatened the future of the four-nation program, was resolved at a cabinet meeting in Bonn.
Canadair's CL-415, the only fire-fighting amphibious water-scooping aircraft in production, could finally get the company into the U.S. market after 25 years of trying, according to an executive of the Canadian company. As suburbs encroach on wilderness areas in the U.S., the capabilities of a -415 will be needed, Tom Appleton, president of the Canadair Amphibious Aircraft Div. of Bombardier, told McGraw-Hill Aviation Week Group reporters in Washington.
The U.S. Air Force is estimating it will be $800 million cheaper to buy and maintain the Joint Air-to-Surface Standoff Missile than the Navy-proposed Standoff Land-Attack Missile-Expanded Response Plus. Air Force Chief of Staff Gen. Ronald Fogleman told Sen. Richard Shelby (R-Ala.) in response to questions earlier this month that "It is our assessment that the SLAM-ER+ production costs plus operation and maintenance costs will be approximately $2.1 billion while the JASSM will cost $1.3 billion."
Senate appropriators have provided the U.S. Navy $7 million in unrequested funds in the fiscal 1998 defense appropriations bill to modify two low-flight hour P-3 Orion aircraft to the "Reef Point" reconnaissance configuration.
The U.S. appeals court in St. Louis yesterday dismissed Wilcox's protest of the FAA's award of the Wide Area Augmentation System contract to Hughes, saying Wilcox "demonstrated no injury." FAA awarded the WAAS contact to Wilcox in August 1995, but terminated it eight months later after finding the company's performance unsatisfactory. It then awarded the contract to Hughes, which was a subcontractor.
LOCKHEED MARTIN and Joint Strike Fighter partners Northrop Grumman and British Aerospace last weekend completed a senior management coordination meeting to bring the three companies closer together. The three-day meeting took place at Lockheed Martin's Tactical Aircraft Systems Div., Fort Worth, Tex.
July 8, 1997 Kongsberg Gruppen Aerospace AS Kongsberg Gruppen Aerospace AS, Kongsberg, Norway, is being awarded a $6,059,999 firm-fixed-price contract for the procurement of six MK2 MOD7 Penguin Missiles for the U.S. Navy. Work will be performed in Kongsberg, Norway, and is expected to be completed in April 1999. Contract funds would not have expired at the end of the current fiscal year. This contract was not competitively procured. The Naval Air Systems Command, Arlington, Va., is the contracting activity (N00019-97-C-0026).
Orbital Sciences Corp., Dulles, Va., has agreed to buy the satellite-making and communications service business units of CTA Inc. for $12 million in cash and assumption of liabilities.
The U.S. Navy's fiscal 1999 through 2003 budget under current plans will include more than $100 million for development of a marinized version of the Army Tactical Missile System (ATACMS), known as the NTACMS. Rear Adm. Daniel J. Murphy, director of surface warfare, said in an interview yesterday that the FY '99 program review will see a substantial investment in NTACMS for the first time. It will be "significantly in excess of $100 million," he said.
