Embraer bests Beechcraft for Afghan plane order

WASHINGTON Wed Feb 27, 2013 6:02pm EST

WASHINGTON (Reuters) - Brazil's Embraer bested U.S.-based Beechcraft in a high-stakes U.S. Air Force recompetition for 20 light air support planes to be provided to the Afghan military for training and counterinsurgency.

Embraer and its U.S.-based partner, Sierra Nevada, were awarded a $427.5 million deal, the Pentagon announced after the close of business on Wednesday.

The pair had won an initial $355 million contract in December 2011, but it was scrapped after a legal challenge from the losing bidder, then known as Hawker Beechcraft.

Brazilian leaders had voiced displeasure with the sudden cancellation, saying it would not be conducive to strengthening security ties with the United States.

Brazil's air force plans to buy 36 new fighter jets, and Chicago-based Boeing Co (BA.N)'s F/A-18 Super Hornet is one of three finalists along with the Saab JAS-39 Gripen of Sweden and the Dassault Rafale of France.

Wichita, Kansas-based Beechcraft, which emerged from a Chapter 11 restructuring this month, said it was disappointed to have lost the competition.

"We will meet with the (U.S. Air Force) for a full debrief of the award and determine our next steps forward at that time," Nicole Alexander, a company spokeswoman, said in an emailed statement.

(Reporting By Jim Wolf; editing by Carol Bishopric and David Gregorio)