Harris Wins Major Contract

Harris Corp. (HRS - Analyst Report) recently won a  $419 million Basic Purchasing Agreement contract to supply the U.S. Army with Falcon III AN/PRC-117G multi-band tactical radios & vehicular power-amplifier adapter systems. The initial delivery order under the contract is valued at $165 million. Harris’ Falcon III AN/PRC-117G radios will be deployed by the U.S. Army for missions worldwide to provide next-generation, high-speed tactical satellite network and voice-and-data communications.
 
Harris has a strong market position in the government communications sector, with a broad product line and an enviable win rate on government contracts (more than 60% historically). The company’s Falcon III tactical radios are being widely used by U.S. Special Operations forces, the U.S. Army and various NATO and “Partnership for Peace” countries. Several industry researches have predicted that tactical radio segment may provide a multi-billion dollar business opportunity to Harris in the next couple of years as overall defense spending is likely to remain firm upgrading the military’s communications infrastructure remains a priority.
 
According to our assessment, in the near-term, Harris will benefit from higher defense expenditure by the U.S. government coupled with new expansion drives in the Asian, European & African markets. The company has established a solid international dealer network to pursue multiyear contracts throughout these regions. Harris has estimated that international markets represent around $4 billion pipeline opportunity. The company has won large-scale multiyear standardization contracts in Mexico, Australia, Algeria, the U.K., Pakistan, Sweden and Iraq .
 
On Oct 12, Harris was awarded a potential three-year contract worth $7.5 million to provide technical and support services, including information assurance, development testing, configuration management and training -- for the U. S. Air Force Air Mobility Command's command and control systems. In last July, the company won five domestic contracts for its Public Safety and Professional Communications services.