Northrop Grumman

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received a $1.9 billion contract from the Defense Department to develop the Navy's Advanced Hawkeye Airborne Early Warning and Control system.

The contract calls for the company to modify a pair of E-2 Hawkeye 2000 aircraft to the Advanced Hawkeye configuration for testing purposes.

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The advanced version features a new radar that allows for continuous 360-degree coverage with the added ability to perform electronic steering for better target detection and tracking.

Operational testing is scheduled to begin in 2007, and initial operational capability is planned for 2011.

Shares of Northrop Grumman were down recently by 57 cents, or 0.6%, to $91.18.