Greece to buy Elisra EW systems

Greece previously cancelled a $200 million deal with Elisra because of US pressure.

The Greek ministry of defense will procure electronic warfare (EW) systems for airplanes and helicopters from Elisra Electronic Systems.

Sources inform “Globes” that under US pressure, Greece previously cancelled Elisra’s win of a $200 million tender to supply EW systems for Greece’s new F-16s.

Greece called the deal off, after Elisra won the official tender to supply EW systems for 50-60 airplanes that Greece had procured from the US, due to US administration pressure on the Greek government. The deal would have been one of Elisra’s largest ever.

The Greek Air Force bought the F-16 Block 52 model, similar to the 110 planes purchased by Israel, for which Elisra furnished the EW systems.

Elisra president and CEO Avner Raz previously confirmed the reason the deal was called off. Elisra, which cooperated with Raytheon (NYSE: RTN) in the tender, considered instituting a lawsuit, after Raytheon submitted a separate bid in the tender. Elisra eventually decided not to file suit, after deciding its case would not stand up in court.

SIBAT - Foreign Defense Assistance and Defense Export Organization, which is responsible for Israel’s defense industries, was unsuccessful in changing Greece’s decision.

Former Deputy Minister of Defense MK Ephraim Sneh (Labor), who was involved in defense industry deals in Israel and overseas, visited Greece a year ago on the matter. He held talks with senior Greek defense officials, in an attempt to persuade them to buy the systems from Israel. The talks failed; Greece also turned down a proposal to include Elisra as a substantial subcontractor for the US company.

After the talks, Greece and Israel agreed that Elisra would be incuded as a supplier for EW systems in other Greek Air Force projects.

Greece is now fulfilling this latest agreement. Elisra will be an EW supplier for Phantom fighters, Hercules cargo planes, Chinook attack helicopters, and Bell and Sikorsky CH-53 cargo helicopters. The first project, for the Hercules planes, will be worth $15 million.

The Elisra group is owned by Koor Industries (NYSE: KOR) 70%, and Israel Aircraft Industries 30%.

Elisra said in response, “The company is continuing its marketing efforts in Greece to supply its systems for various projects.”

Published by Globes [online] - www.globes.co.il - on January 6, 2003

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