Raytheon obtains $126 million contract

Raytheon Company announced on Thursday that it received a $126 million U.S. government contract for the SM-3 missile defense system.

The contract was awarded as a sole-source, cost-plus-incentive-fee contract. This modification to the contract was put in place in order to procure the material required to manufacture up to 29 SM-3 Block IB missiles.

The SM-3 Block IB missile system differs from other anti-missile systems. Other anti-missile systems use an explosive warhead that detonates upon impacting, or when in close proximity to, the incoming missile. The SM-3 uses sheer impact, which can be up to the equivalent of a 10-ton truck traveling at 600 mph, in order to destroy the incoming missile.

There are currently more than 150 SM-3s in the U.S. and Japanese navies. Next generation SM-3s are on track to be deployed in 2015 and will be deployed on both afloat and ashore weapons systems.

The manufacturing of the missiles will be done in Tucson, Arizona and is estimated to be completed by September 30, 2016.

Raytheon Company is a technology and innovation company that specializes in defense, security and civil markets. Raytheon provides state-of-the-art electronics, mission systems integration and other capabilities in the areas of sensing, command, control, communications and intelligence systems and a broad range of mission support services.