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United Defense, RAFAEL Partner to win US Navy Contract

UNITED DEFENSE Partners With RAFAEL to win US Navy Contract for Weapon Station

09 June 2004 -- United Defense Industries, Inc (NYSE:UD) together with RAFAEL Armament Development Authority Ltd, has won a contract for the Mk 38 Mod 2 Machine Gun System to be provided to the US Navy. The contract, with value up to $395.5 million, will cover the production, engineering, support and spares for the system and is intended to upgrade the Navy's surface combatant ships for self-protection purposes.

The winning system is based on RAFAEL's TYPHOON - a family of naval stabilized gun and weapon systems. The TYPHOON has exceptionally high hit and kill probability and is remotely operated from under the deck thus making it the weapon of choice for Anti-Terror/Force Protection (AT/FP) task. The TYPHOON is capable of acquiring targets and engaging them autonomously or through the ship's combat systems. The high accuracy and lethality of the TYPHOON is achieved through the utilization of high stabilization, together with Electro-Optical director – RAFAEL's TOPLITE.

The TYPHOON has been operationally proven and the weapon of choice for several navies worldwide. Recently the TYPHOON has been selected by the Royal Australian navy for its new Armidale-class patrol boats.

United Defense will receive orders for the MK 38 Mod 2 Machine Gun Systems through 2010 and will work together on the development and production with RAFAEL. David Zait, Corporate VP and General Manager Systems Division at RAFAEL says that "This contract is an important achievement for us; combining the reputation of United Defense as the main naval gun integrator in the US with the superior technology of the TYPHOON weapon station." RAFAEL is hopeful that further orders for its naval weapon stations will be forthcoming from other naval agencies in the US.

According to Keith Howe, Vice President and General Manager of United Defense Armament Systems Division, in a statement released by UD yesterday, "The Navy has an urgent need to improve the lethality and effectiveness of its ship self-protection systems. Through the competitive source selection process, the Navy has gotten the best of both worlds – an exceptional weapon at a great price."

United Defense designs, develops and produces combat vehicles, artillery, naval guns, missile launchers and precision munitions used by the US Department of Defense and allies worldwide, and provides non-nuclear ship repair, modernization and conversion to the US Navy and other US Government agencies.

RAFAEL designs, develops, manufactures and supplies a wide range of advanced defense systems for all branches of the Israel Defense Forces and other armed forces worldwide. These leading-edge products are based on RAFAEL vast technical and operational experience. In addition to its defense technologies, the company has also formed partnerships with civilian counterparts to develop commercial applications based on its proprietary technology. RAFAEL has a workforce of over 5000 employees and registered sales of $830 M in 2003.

For further information please contact
RAFAEL public affairs. Tel: 972-4-8791244