United Technologies Corp. (UTX - Free Report) is reportedly set to win a huge contract worth $6.8 billion for 112 rescue helicopters from the U.S. Air Force, as most of its competitors have missed the deadline to submit the requisite bids. The multi-billion deal will likely provide a much-needed boost in the Sikorsky helicopter segment of the company.
The helicopters are intended to be utilized for rescue operations by pilots downed during missions or for civil search and rescue efforts, humanitarian missions, disaster relief and casualty evacuation.
Sikorsky is one of the world’s largest manufacturers of military and commercial helicopters and also provides helicopter and aircraft parts and services. At present, major production programs at Sikorsky include the UH-60M Black Hawk medium-transport helicopters and HH-60M Medevac helicopters for the U.S. and foreign governments, the S-70 Black Hawk for foreign governments, the MH-60S and MH-60R helicopters for the U.S. Navy, the International Naval Hawk for multiple naval missions, and the S-76 and S-92 helicopters for commercial operations.
Sikorsky’s aftermarket business includes spare parts sales, overhaul and repair services, maintenance contracts and logistics support programs for helicopters and other aircraft. Sales are made directly by Sikorsky and by its subsidiaries and joint ventures. Sikorsky is also increasingly engaging in logistics support programs and partnering with its government and commercial customers to manage and provide maintenance and repair services.
As several rival companies such as Northrop Grumman Corporation (NOC - Free Report) and AgustaWestland NV; a joint venture company of The Boeing Company (BA - Free Report) and Bell Helicopter Textron Inc. (TXT - Free Report) ; and European Aeronautic, Defence and Space Co. had refused to submit bids for the tender offer for 112 rescue helicopters, Sikorsky is likely to wind up with the contract undisputedly. However, the U.S. Air Force spokesperson has denied commenting on this regard citing fair and transparent process that prohibits sharing of information until the selection process is fully completed.
Based in Hartford, Connecticut, United Technologies is a diversified company that provides a broad range of high-technology products and services to the global aerospace and building systems industries. The company also operates a central research organization that pursues technologies for improving the performance, energy efficiency and cost of its products and processes.
United Technologies currently has a Zacks #3 Rank (Hold). We have a long-term Neutral recommendation on the stock.