United Tech, US reach $1 bln-plus deal for F-35 engines -sources

WASHINGTON Mon Aug 26, 2013 10:38am EDT

WASHINGTON Aug 26 (Reuters) - Pratt & Whitney, a unit of United Technologies Corp has reached agreement in principle with the Pentagon on a contract to build 39 engines for a sixth batch of F-35 Joint Strike Fighters, three sources familiar with the deal said Monday.

The agreement is valued at over $1 billion, said the sources, who were not authorized to speak publicly.

The Pentagon reached agreement with Lockheed Martin Corp , which builds the jets, in late July. The government buys the engines separately from Pratt & Whitney, which is the sole producer of engines for the radar-evading warplane.

Pratt President Dave Hess had told Reuters in June that he expected to reach an agreement with the Pentagon within the next 30 days on the next engine contract, reflecting a cost reduction of less than 10 percent.

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