Ministry of Defense terminated a contract for the upgrading
of attack and assault helicopters awarded to Elbit Systems in
2004. Elbit Systems won the contract to modernize 12 Russian-built
Mi-24 attack helicopters and six Mi-17 transport helicopters
offering €57 million (about US$74 million) beating competition
from BAE Systems, Sagem and IAI.
The program faced serious obstacles immediately after the selection
was announced as the Russian manufacturers of the helicopters
and engines protested that the program withheld permit to authorize
the work and refused to support their engines. The Bulgarian
Ministry of Defense reluctantly pursued with the program under
a Bulgarian court order.
The issue was resolved during recent meetings
between Bulgarian Minister of Defence Vesselin Bliznakov and
Elbit chief executive Josef Ackerman. Bliznakov and Ackerman
agreed that the deal was scuppered by circumstances of international
dimensions beyond their control. According to Elbit Systems,
the cancellation discussions with the Bulgarian Ministry of
Defense have been based on appropriate compensation to Elbit.
The contract will most probably go to the local defense firm