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NEWS IN BRIEF

23 Apr 04. Plans are well advanced to spin off the civil engineering activities of Finmeccanica, the state-controlled industrial conglomerate, and lump them with Fincantieri, the state-owned shipbuilding group. This new entity would combine shipbuilding with power generation and railway equipment: the image of Alstom. The idea is to unshackle Finmeccanica from its troublesome civil engineering operations, allowing it to become a pure defence and aerospace player. If allowing Finmeccanica to focus on defence and aerospace is sensible, it would have been better to seek individual solutions for the civil businesses through sales or partnerships with other international groups rather than create a new state monster. Pity Finmeccanica’s minority shareholders. Although the Treasury owns only 32 per cent, it holds a golden share and no other shareholder can own more than 2 per cent. They will have to suffer in silence. (Source: FT)

22 Apr 04. United Defense Industries Inc. (NYSE:UDI – News) on Thursday posted higher first-quarter earnings and raised its full-year profit and sales forecasts, citing strong demand for military equipment and gains from acquisitions. The company reported earnings of $41.9m, or 78 cents per share, compared with $38.4m, or 73 cents per share, in the same quarter a year ago.

22 Apr 04. Northrop Grumman Corp, lied to the Air Force about the readiness of its radar-jamming equipment in the late 1980s, according to recently unsealed court documents from a whistle-blower case against the company. The documents, unsealed Wednesday in Chicago by U.S. District Judge Ronald Guzman, also show Century City-based Northrop Grumman submitted fraudulent bills on other equipment. “We lied our teeth off” and “now we need to make these lies come true,” one of the documents quotes a Northrop manager telling employees in 1985, as the radar-evading equipment for the company’s B-2 stealth bomber was undergoing a critical design review. The Northrop radar-evading program was eventually canceled by the Air Force because of problems with the systems and after rival Lockheed Martin Corp. provided an alternative. The whistle-blower suit is scheduled to go to trial later this year. The documents show there also are fraud accusations against Northrop about the company’s alleged overcharging for materials and falsifying of data. The Justice Department, representing the former Northrop employees who filed the suit, says Northrop managers lied about the readiness of radar-evading technology for the bomber. Filed under the False Claims Act, the suit seeks $369 million in damages. If Northrop is found guilty, the damages can be tripled.

21 Apr 04. The Lockheed Martin [NYSE: LMT] led team competing for the E-10A Battle Management Command and Control (BMC2) system this week demonstrated advanced capabilities for cruise missile defense and time-critical targeting (TCT), both integral components of the team’s prototype solution. With the release of the final BMC2 Request for Proposals expected soon, the Lockheed Martin team demonstrated how a focus on common functionality across key constellation nodes and automation of manual processes will help deliver unprecedented speed of operations to future BMC2 users. Highlighting results of exercise-quality simulations conducted at the team’s HI-Vision horizontal integration lab in Colorado Springs, the BMC2 team ran through a number of scenarios focused on finding, targeting and engaging cruise missiles, ground moving targets, and enemy command installations in single-digit minutes.

21 Apr 04. Honeywell International Ltd. (NYSE:HON – News) on Wednesday posted a 16 percent gain in first-quarter profit on strong demand in its key aerospace business from the U.S. military and airline customers. Honeywell also forecast 2004 profit would top the consensus Wall Street estimate. Net income rose to $295mi, or 34 cents a share, from $254m, or 30 cents, a year ago. Honeywell’s aerospace unit, includ

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