Industry Week in Review – September 27, 2013
Faced with steep budget cuts that could cut billions of dollars in planned spending over the next decade, the U.S. Air Force is considering eliminating its entire fleet of KC-10 tankers and A-10 attack jets in an effort to keep existing procurement initiatives on track. Pentagon leaders and officials have reiterated that the close-air support mission provided by the 340-aircraft A-10 fleet can be done with other platforms and that its mission is less relevant now as the Air Force turns more towards the Pacific region. On the other hand, leaders within the Reserve and National Guard branches of the Air Force, as well as the Army, view the aircraft’s mission as particularly critical for the defense of ground troops.
Although not yet official, the potential elimination has already stirred chaos in Congress. Senator Kelly Ayotte (R-New Hampshire) has placed a hold on the White House’s nominee for new Air Force secretary, Deborah Lee James, until the uncertainty surrounding the A-10 program is resolved to ensure there is no capability gap that could result in the loss of American lives.
Elbit Systems Ltd. (Up 6.4%) – Shares were up this week after the Company was awarded a $44.8 million indefinite-delivery / indefinite-quantity contract to service and support the U.S. Marine Corps’ AH-1W Super Cobra helicopters’ night targeting systems.
AAR Corp. (Down 6.2%) – Shares were down this week after the Company reported a decline in first quarter profit and revenue compared to the same period last year.
The Safariland Group, a portfolio company of Kanders & Company, acquired the Explosive Ordinance and Crew Survivability businesses of Allen-Vanguard Corporation,a provider of Med-Eng brand bomb disposal suits and products for blast attenuation and thermal management. Terms of the deal were not disclosed.