Sikorsky offers £125m to 'secure' FLS jobs

[Heliport]

from the Irish Times
By Mark Hennessy, Political Reporter

Sikorsky Helicopters has told the Government it will offer £125 million of business to the troubled FLS Aerospace if it wins a £100 million contract to supply up to five helicopters to the Aer Corps.
In a letter to the Government, Sikorsky's president, Mr Dean Borgman, said the firm had already signed conditional agreements with the Dublin Airport-based FLS.

Beginning late next year, Sikorsky's parent, United Technologies, will send 12 Boeing 767s and 20 narrow-bodied jets to FLS to be converted for cargo use if it wins. The closing date for "best and final price" tenders from the four firms in the hunt to supply the Aer Corp's demand for a medium-range helicopter expires at noon today.

An examination by a Department of Defence team has shown that all the models on offer meet the technical demands required, a number of sources have indicated.

The leading contenders for Ireland's biggest military contract are Sikorsky's S-92, EADS-Eurocopter's Cougar and the EH-101 from a consortium led by Augusta/Westland. Two will be bought for search and rescue operations, along with an option on a third, while options are on offer for two more "general purpose military transports".

The prospect of extra business for FLS has whetted the appetite of Fianna Fáil Dublin northside TDs, who have lobbied the Minister for Defence, Mr Smith, and the Taoiseach. FLS has been hugely damaged by the fall-out from the September 11th atrocities and it has very little business on its books after March, according to industry sources.

The Irish contract is hugely important to Sikorsky, which has conducted a high-profile campaign - often to the annoyance of senior Department of Defence officials. In his letter last week, Mr Borgman said the offset business to FLS and other Irish companies, including AIB, "clearly demonstrated its commitment" to the country.
Yesterday, an FLS spokeswoman said the cargo conversions would help to secure the 1,600 jobs in the airport: "It puts us into a new market," she said.

EADS Eurocopter said recently it would match an earlier version of Sikorsky's offset offer but no concrete proposals have yet been made.

[Heliport]

from the Irish Independent
by Karl Brophy, Political Correspondent

State faces £100m helicopter snag

THE Government is facing a potential £100m legal action over its tendering process for five new helicopters amid claims that the selection process has been "contaminated by politics".

The Department of Defence yesterday received final offers from three major international companies for the right to supply three search and rescue and two troop carrying helicopters.

The contract is estimated to be worth over £100m.

However, one of the bidding firms now fears that the Government is intent on doing a deal which will see up to 1,600 jobs saved in beleaguered north Co. Dublin.

EH Industries, which is offering the Merlin helicopter, has warned it will consider legal action against the State if promises of investment in troubled Irish companies from their competitors are taken into consideration. American helicopter giants, Sikorsky, has already told the Government it will pour £125m into FLS Aerospace at Dublin Airport if it wins the Irish supply contract.

Eurocopter, which manufactures the Cougar helicopter, is understood to have made a similar offer which is known in the industry as an "offset" deal.

But EH Industries, the makers of the biggest and most versatile aircraft in the competition, says this lack of transparency could leave the Government exposed to a massive legal challenge.

Unlike other European countries, like Portugal and Denmark which have recently held similar competitions won by the Merlin helicopter, there is no mention of an "offset deal" in the Irish tender document.

This means that the Government is not allowed to take any offers of investment in the country into consideration when deciding on which company will be selected to provide the helicopters.

"We are concerned that the selection process for these helicopters, which will be saving lives around the Irish coast for decades to come, has been contaminated by politics and the issue of saving jobs in North Dublin," said Bob Adams of EH Industries yesterday.

It is understood that the EH Industries tender is the most expensive of the three major offers submitted yesterday. However, their helicopter have a 30pc greater capacity and a significantly greater operating range than the other two competing aircraft.

The price being asked by all the tendering companies has also dropped by in excess of 15pc since September 11, as the firms are anxious to consolidate business.

But a Department of Defence spokesman insisted yesterday that the "offset" deals that have been offered would not be taken into account in the decision making process.

"The decision will be made on the tender, and any offset negotiations and discussions will be taken after that," said the spokesman.