Lockheed Martin Corp was awarded a $2.4 billion Pentagon contract on Monday for THAAD interceptor missiles, some of which are slated to be delivered to the Kingdom of Saudi Arabia.
Reuters had reported Lockheed was nearing the deal earlier on Monday.
In November, Saudi and US officials signed letters of offer and acceptance formalizing terms for Saudi Arabia’s purchase of 44 Terminal High Altitude Area Defense launchers, missiles and related equipment.
The Pentagon said the Saudi government would pay $1.5 billion of the $2.4 billion.
Lockheed Martin, the biggest US arms maker, builds and integrates the THAAD system, which is designed to shoot down short-, medium- and intermediate-range ballistic missiles. Raytheon, another US firm, builds its advanced radar.
As a part of the scope of work outlined by the Pentagon, obsolete systems currently in place will be updated to prepare the current Saudi missile defense infrastructure for the new THAAD technology.