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Newsday September 30, 2005

Speaking their language: $3.1B in contracts

By James Bernstein

The Army wants more than a few good foreign-language translators, and as unlikely as it seems, two large manufacturers of fighting equipment - Northrop Grumman Corp. and L-3 Communications - said yesterday they will bid on what is expected to be $3.1 billion in Pentagon contracts for such work.

In effect, L-3 is the incumbent company. It acquired Titan Corp. of San Diego earlier this year, and Titan has Army contracts to provide translators in Iraq and other places.

But Northrop Grumman ended up in the translation business a few years ago when it acquired defense contractor TRW Inc.

The Army yesterday released its formal request for proposals from bidders, who stand to gain as much as $600 million a year for the translator contracts, which are to run for five years.

L-3 Communications Holdings Inc. is a Manhattan-based company best known as a supplier of intelligence, surveillance and reconnaissance equipment. It declined to comment beyond stating its plans to bid.

Northrop Grumman, the Los Angeles-based military contractor known as a manufacturer of Navy ships and airplanes, has a large presence in Bethpage.

"We're confident we're a strong competitor," said Northrop Grumman spokeswoman Janis Lamar.

The Army issued requests on three 5-year contracts. The largest - $2.6 billion - covers operations in Iraq. Lamar said Northrop Grumman plans to bid "some combination of those three solicitations in either a prime or a subcontracting role."

Army officials are to select a winner Dec. 22.

Both Northrop Grumman and L-3 are already providing translating services. In July, L-3 bought Titan for nearly $2 billion. Earlier this year, Titan said that it had 5,000 linguists in 24 countries.

Northrop Grumman has about 700 linguists in Bosnia and Kosovo. With sales last year of $29.9 billion, Northrop Grumman is the far larger company. L-3's sales last year were $6.9 billion.

"The incumbent would usually have the edge," said Paul Nisbet, an analyst for JSA Research Inc. in Newport, R.I.

But Titan has had its share of problems.

Last year, a U.S. Army general told Congress that at least one Titan translator was present during the abuse of prisoners at the Abu Ghraib prison in Iraq. Titan said it had fired the translator.

Earlier this year, Titan admitted violating federal anti-bribery laws and agreed to pay more than $28 million to settle charges it had sought to influence elections in the Republic of Benin, in Africa, in exchange for higher fees on a telecommunications project.

John Pike, director of Globalsecurity.org, which monitors the defense industry, said that there is a potential security risk in the Army's outsourcing so much translating work.

"Private companies are in business to make money," Pike said.

"To make sure there is some money left over at the end of the year, they're going to cut costs. A good place to cut costs is security."


Copyright 2005, Newsday Inc.