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Alliant signs $750 million Boeing deal

SHARE Alliant signs $750 million Boeing deal

The new $750 million contract that Alliant Technologies has signed with Boeing will create 100 new jobs at Alliant's facilities in Magna and Clearfield and safeguard at least through 2004 the jobs of some 300 Utahns already working on solid rocket boosters for Boeing's Delta satellite launch vehicles.

"This is a great event because it represents the largest order in our history," said Richard Schwartz, Alliant's chairman and CEO.And if Boeing exercises additional production options for the rocket boosters in coming years, the current contract could be increased by another $1 billion, said Schwartz, who spoke via a telephone hookup from the company's corporate headquarters in Hopkins, Minn., to a press conference held Monday afternoon at Little America Hotel.

Paul A. Ross, group vice president of Alliant's Space and Strategic Systems division, termed the new contract "crucial to our company" which has undergone major employee reductions in recent years.

Alliant's Space and Strategic Systems currently employs 1,500 people at its Bacchus Works plant in Magna and another 300 in Clearfield. Of those 1,800, 300 are working on the Delta program so that number will be boosted to 400 on Delta and 1,900 overall. There are also some employees in Florida and California.

A spokesman said the company will begin gearing up immediately for the additional work.

In addition to the new jobs, Ross noted that the Boeing contracts will mean an additional $10 million to $18 million of spending in Utah for materials and sub-contractors.

For the last fiscal year, the group had sales of $370 million.

Alliant has been building the Delta II rocket boosters for Boeing for 12 years. The expendable motors help lift communications satellites into orbit around the earth. Boeing has launched some 250 Delta rockets since 1960 at a 97 percent success rate, the highest of any launch vehicle in service.

Boeing is currently developing the Delta III that will more than double the payload of the Delta II. The Delta III uses nine boosters. Development work is also underway on a Delta IV vehicle, the largest of which will be able to lift 33,000 pounds into high orbit and 60,000 pounds into high orbit.

Schwartz termed the contracts "the best of all worlds" for Alliant.

"They ensure our participation in an exciting business with a great company, and they will contribute significantly to our long-term goal to grow earnings per share at an average annual rate of 15 percent, which is key to delivering greater shareholder value."

He said the contracts will increase Alliant's backlog to more than two years of sales. They will require an up-front cash investment by the company but will solidify its core business and contribute to growth potential.

Jay Witzling, vice president of Delta II for Boeing, said launching satellites is becoming an increasing part of the Seattle-based aircraft and aerospace company's business.

"We expect to see 1,500 satellites launched through 2006," he said. That compares with only 16 launched all of last year.

Alliant Techsystems is a $1.1 billion company with a total of 6,600 employees in 23 states. Its other business groups include Conventional Munitions and Defense Systems.