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Boeing, Lockheed win $2.78 billion deal at Abu Dhabi defence show

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C-17 of Royal Air Force. Boeing image

ABU DHABI (BNS): The Abu Dhabi defence exhibition continues to bring in good news for the companies as the latest reports indicate that Boeing and Lockheed Martin may have bagged contracts worth $2.78 billion.

While Boeing’s share in the deal is pegged to be $1.17 billion and Lockheed would take home $1.61 billion. The Gulf state was on the lookout for military transport aircraft and the US companies have defeated their rivals for the contracts.

The United Arab Emirates would buy at least 15 aircraft from the two companies. These would include a mix of C-17s and C-130 Hercules. Agencies quoted chairman of Abu Dhabi’s international defence exhibition Major General Al-Ketbi as saying that four C-17s would be bought and order had been placed for 12 C-130s.

It is already raining orders at the defence exhibition despite a global economic meltdown. Even as two days are left for the show to end, orders more than four billion dollars have been finalised. Most of these have been placed by the host country which is emerging as one of the biggest arms buyers in the region.

The Gulf has been a sufficiently huge buyer of military equipment due to the ongoing hostilities in the region with Saudi Arabia being the biggest customer.

But UAE, riding high on its oil driven economy, is fast emerging as military hardware hub as it has been on a shopping spree for all the latest equipment available in the market. No wonder that Abu Dhabi show has become the hunting ground for arms companies to do some brisk business at the time when the going it tough in the international market due to meltdown.

Apart from the military transport aircraft deal, separate orders worth $3.35 billion have been finalised. These include supply of various categories of equipment and setting up of maintenance facilities.

The show has attracted massive participation with 900 exhibitors from 50 countries setting up their shops in Abu Dhabi. The number of participants has doubled this year compared to the previous edition of the show held in 2007.

Apart from the land systems and military aviation, the show also included a section on warships and naval craft expanding the scope of business.

The finances for the military aviation contracts would be arranged by local leasing and financing company Al-Waha. The move is part of the modernisation drive, said UAE officials.

The companies, however, said the final deal was yet to be sealed as some aspects of the contracts were still being negotiated. But they hoped that it would be clinched soon. The other contracts include setting up a combat training centre for the UAE Armed Forces. Germany’s Rheinmetall Defence Electronics has got this contract worth $125.2 million.

UAE’s own company Advanced Integrated Systems will supply its products to the armed forces in an order worth $118 million.

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