Northrop Grumman in Shipshape With Destroyers

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Northrop Grumman Corp., the nation’s largest shipbuilder, has been awarded a $1.4 billion Pentagon contract to begin construction on DDG-1000 Zumwalt-class destroyers commissioned by the U.S. Navy.


The Los Angeles-based defense contractor will split work on the ships with Falls Church, Va.-based General Dynamics Corp., which also won a $1.4 billion contract.

“A strategy for dual lead (contractors) provides great advantages,” said John Young, the Pentagon’s chief weapons buyer, in a statement. “It keeps the shipbuilding labor force skilled and active, it provides incentives for successful production and it helps the Defense Department to ensure that we get the best possible value for the taxpayer.”

The 600-foot-long Zumwalt-class destroyers have a flexible design that allow them to operate as part of a joint maritime fleet, assisting the Navy at sea and Marine strike forces on land. The Navy plans to build seven of the ships.

Northrop was awarded a $90 million contract in November for preconstruction work on the destroyers.

Northrop executives said the company will use more composite materials on the destroyers than in previous ships, something the company projects will be an important component of future ships.

Separately, the company announced a $17 million contract for work on radar warning receivers for the Navy’s CH-53K helicopters.


Bidding Calms

A heated bidding war for frozen-foods maker Overhill Farms Inc. has decidedly cooled in the past two weeks after news of acquisition attempts sent the company’s stock soaring.

Overhill’s board of directors recently rejected a proposal submitted by GESD Capital Partners and Citicorp Venture Capital to acquire the company for $4.40 per share. The offer was a 74 percent premium over the closing price the day before it was made, but the stock has since topped $5 a share.

“The stock actually went above the offering price, so we would have had a negative premium,” said Alexander Auerbach, a member of the board of directors. “We felt the offer was inadequate to shareholders.”

The GESD group was one of two entities competing to acquire the $192 million company. The identity of the other bidder was not disclosed. Vernon-based Overhill makes airline meals and supplies food to Jenny Craig weight-loss programs.

The acquisition attempts were revealed when Louis Giraudo, co-founder and senior managing partner of GESD, resigned from Overhill’s board of directors earlier this month. Giraudo said he disagreed with the board’s decision not to grant GESD an exclusive negotiating period for its acquisition effort.

Since Overhill rejected the proposal, the bidding competition has cooled but it is not dead. “We said to both of them that we would be open to continuing discussions,” Auerbach said.


Flying High

Unmanned aerial vehicles are proving a hot commodity with the armed forces.

Aerovironment Inc., a Monrovia-based manufacturer of unmanned aircraft, announced that the U.S. Army has ordered additional Raven planes for a total value of $45.8 million.

The Raven, a 4-pound hand-launched aircraft, is Aerovironment’s most popular product. The planes can include cameras that provide soldiers with surveillance and reconnaissance capabilities on the battlefield.

The Defense Department recently said its unmanned aerial vehicles logged more than 500,000 hours in flight last year and it expected the Raven to rack up about 300,000 hours in 2008.

The new order is scheduled to be delivered within a year, with the aircraft to be deployed by the Army and the Marine Corps.

The company did not say how many planes will be included in the order, but Aerovironment has delivered more than 8,000 to date.


New Rectifier Chief

International Rectifier Corp., which has been embroiled in an accounting scandal for nearly a year, named Oleg Khaykin president and chief executive, effective March 1.

Khaykin replaces Donald Dancer, who has served as acting-chief executive since longtime CEO Alex Lidow stepped down from the post in August.

Khaykin also was elected to the company’s board of directors.

The El Segundo computer chip manufacturer is being investigated for accounting irregularities that extend back roughly two years in one of its foreign subsidiaries.


Staff reporter Richard Clough can be reached at (323) 549-5225, ext. 251, or at

[email protected]

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