Mesa's Talley wins $51 mil contract

Mesa-based Nammo Talley Inc. has snared a $51.76 million contract to develop and build a next-generation portable rocket launcher for the Marine Corps.

The new shoulder-launched multipurpose assault weapon will replace existing equipment that is 25 years old.

"This is a very significant contract because it allows us to remain a major supplier to the U.S. military," Talley President Steven Wegener said.

He said it also provides long-term job security for the 250 people who work at the company's Mesa plant.

Formerly known as Talley Defense Systems, the company has been making the ammunition fired by the launchers but not the launchers themselves, since the 1990s. The new contract puts Talley in charge of developing the new high-tech launchers in addition to the rockets they will fire.

Talley has contracted out production of the launchers to Raytheon in Tucson but will continue to make the ammunition in Mesa.

The contract runs until 2012, and calls for the development and initial production of 146 launchers and 915 rounds of ammunition.

Marty Muir, Talley's chief operating officer, said the company expects to get a long-term supply contract for more than 1,000 launchers and tens of thousands of rockets.

He said that, since the 1990s, Talley has sold the Marines more than 40,000 rockets, which have been used in about 1,500 launchers now in the field.

The portable launcher rests on a Marine's shoulder and fires an 83mm rocket up to 1,650 feet. Itsprimary targets are tanks and bunkers, but it is increasingly being used in Iraq and Afghanistan to take down buildings.

The launcher now in service is based on the Israeli B-300 and was introduced to the U.S. military in 1984. It has seen duty in Operation Desert Storm and the wars in Iraq and Afghanistan.

Talley's Phoenix-area roots date to the late 1950s, when the company pioneered the development of aircraft ejection seats. Talley went on to build rocket motors, automobile air bags, weapons and other propellant-loaded products.

Muir said the company continues to make the rockets that blast ejection seats up and away from a troubled aircraft.

Over the years, Talley has faced numerous safety issues because of a series of explosions that have killed at least one employee.

Talley Defense Systems formed the nucleus of Talley Industries, an early Phoenix-area Fortune 500 company.

At one time, its holdings included clockmaker Westclox and the Arizona Biltmore Hotel.

But the company fell on hard times after the 1990 real-estate bust and was sold in 1998 to Carpenter Technology Group of Reading, Pa. Carpenter dismantled the company and, in 1999, sold Talley Defense Systems to its employees.

Last year, the business was acquired by Norwegian defense contractor Nammo A.S. for an undisclosed sum.

The move gave Nammo an entree to the U.S. defense market and Talley a vehicle through which to sell its products overseas.

Reach the reporter at max .jarman@arizonarepublic.com or (602) 444-7351.