Alliant Techsystems Inc.
) has received a contract, worth $16.8 million, from the U.S. Army.
This contract is an engineering and manufacturing development
contract modification for Alliant's XM25 and Individual
Semi-Automatic Airburst System. Per the agreement, the company will
continue to design, integrate, produce and examine these fully
functional systems. Alliant also will check the weapon's final
design as per the performance requirement.
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The XM25 is a Semi-automatic rifle with caliber, weight, length and
magazine capacity of 25mm, 12-12.5 pounds, 29.5 inches and 4
rounds, respectively. This rifle fires a 25mm airbursting round set
by the weapon's integrated target acquisition and fire control
system to burst straight above a selected object. This system
permits soldiers to quickly and accurately target an object by
producing an adjusted aim-point based on range, environmental
aspects, and user inputs.
Alliant is the main contractor, supplier, operations integrator and
ammunition provider for the XM25 program. This program management
is located in the company's Armament Systems Division in Plymouth,
Minnesota. The other players of this program included Heckler &
L-3 Communications Holdings Inc.
) Integrated Optical Systems division.
Alliant will also be providing assistance to Army XM25 Forward
Operational Assessments ("FOA"), which is planned for 2013 with a
36-gun battalion set of new pre-production prototypes.
The U.S. Army used early XM25 prototype weapons in Afghanistan from
2010 to 2012. At the same time, the army carried out FOA with these
weapons. After gathering feedback from the soldiers, the U.S. Army
intimated their comments on the weapons related to system
improvements, tactics and other several issues to Alliant.
Alliant plays a significant role to meet the U.S. Army's demand for
several caliber ammunitions. In June 2012, Alliant received a
contract, worth $36 million, from the U.S. Army to provide 120mm
training ammunitions for M1A1/A2 Abrams main battle tanks.
As far as Alliant's XM25 contracts are concerned, Alliant awarded a
contract modification, worth $24 million, from the U.S. Army in
November 2011. Per the agreement, the company provided additional
ammunition, hardware, test and analysis support additional user
evaluations of the XM25 and Individual Semi-Automatic Airburst
System to the army.
We view Alliant as an organization with well diversified product
portfolio. It is one of the important aerospace and defense
products and solutions contractors of the U.S. Department of
Defense. The company provides various calibers of ammunition
including small-arms ammunition, composite components for
commercial and military aircrafts, and precision-strike weapon
systems to the U.S. armed forces and police.
In addition, the company has a strong relationship with the
National Aeronautics and Space Administration ("NASA") and is
working with NASA to develop the Ares 1 Solid Rocket to replace the
We believe these expanded revenue streams enable the company to
improve its forthcoming financial as well as operational
Alliant Techsystems Inc. currently retains a Zacks #1 Rank, which
translates into a short-term Strong Buy rating.
Minneapolis, Minnesota-based Alliant Techsystems Inc. supplies
aerospace and defense products to the United States government
agencies. The company also supplies ammunition and related
accessories to law enforcement agencies and commercial