Boeing Gets $6-Billion Defense Contract

Boeing Co. has received a contract option worth up to $6 billion to continue as top contractor for the Defense Department on a new ground-based national missile program, the Pentagon said. The six-year contract, through September 2007, extends work that Boeing first won in April 1998 when it was awarded a three-year deal worth $1.6 billion in competition against a team of Raytheon Co. and Lockheed Martin Corp. The total value of the extension could be worth up to $13 billion if all contract options are exercised. In early September, President Clinton deferred to the next administration a decision about whether to start initial construction of the controversial system. President-elect George W. Bush has said he’s likely to expand the system under development. Raytheon Co., which makes the warhead and precision-tracking ground radar, and TRW Inc., which makes the program’s command-and-control system, are Boeing’s top subcontractors. Work on the contract will be performed in Colorado, Alabama, Arizona and Massachusetts. Seattle-based Boeing fell $1.19 to close at $63.44 on the NYSE.