Chile is the first country outside Israel to procure the most advanced unmanned aerial vehicle (UAV) made by Elbit Systems Ltd. (Nasdaq: ESLT; TASE: ESLT), the Hermes 900. Industry sources estimate the deal at several tens of millions of dollars. Elbit Systems will also supply ground control stations and designated payload systems for a range of operations.
Industry sources said that Chile's defense forces will use the Hermes 900 for reconnaissance and observation missions along its long coastline. The UAVs will lower the cost of these missions, which are currently carried out by Chilean Air Force reconnaissance aircraft.
Elbit Systems recently completed development of the Hermes 900, and has delivered a few units to the Israel Air Force (IAF), which is testing them. Industry sources recently said that Israel will declare the UAV operational within a few months.
The Hermes 900 is a development of the Hermes 450, which the IAF has used for years. The Hermes 900 is larger and some of its capabilities have been doubled. It has an endurance of 30 hours, can carry half-ton payloads of advanced observation systems, radars, and electro-optical systems. The UAV can reach a higher altitude of 30,000 feet, and if fitted with GPS systems, can have unrestricted range.
Elbit Systems says that the UAV's configuration enables the simultaneous integration of a great many systems, which can be quickly and easily converted for the operator's needs, without the need to adjust the operating infrastructure for every mission.
The sale of the Hermes 900 to Chile further consolidates Elbit Systems' position in Latin America, a market that the company targeted several years ago. In the past year, the company has signed contracts to supply the Hermes 450 to Brazil and Mexico. Sources close to the company say that it is in talks for possible contracts with the defense forces of other countries in the region.
Elbit Systems' share price fell 0.4% on Nasdaq on Friday to $49.72, giving a market cap of $2.12 billion, but rose 0.6% by mid-afternoon on the TASE today to NIS 170.20.
Published by Globes [online], Israel business news - www.globes-online.com - on June 6, 2011
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