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LIG Nex1 Secures $3.2 Billion Deal with Saudi Arabia for Missile Interceptor System

The Cheongung II Sale Marks South Korea's Expanding Defense Export Footprint in the Middle East
South Korea
l 079550.KO Mid and Small Cap 2000
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South Korea’s LIG Nex1 Co., a prominent defense system developer, has made a landmark $3.2 billion agreement to export its advanced missile interceptor, the Cheongung II, to Saudi Arabia. This deal, disclosed by the defense ministries of both nations, underscores the growing ties between South Korea and Middle Eastern countries in defense collaborations. The Cheongung II, also known as the M-SAM II or “heaven’s bow,” is designed for mid-range aerial threats, boasting a “hit-to-kill” capability.

The agreement follows a similar $3.5 billion contract with the United Arab Emirates in January 2022, indicating a robust demand for Korean defense technology in the region. This demand is partly driven by increasing security concerns, including threats from Yemen’s Houthi rebels to Saudi territories and broader geopolitical tensions.

The M-SAM II system, integral to South Korea’s Korea Air and Missile Defense (KAMD) strategy, is hailed for its impeccable target hit rate. Its deployment in Saudi Arabia is expected to significantly enhance the kingdom’s defensive capabilities against aerial threats. Additionally, Hanwha Systems Co. and Hanwha Aerospace Co. are participating in the deal, supplying essential components for the missile system.

This contract not only reinforces South Korea’s position as a key global arms exporter but also aligns with the country’s ambitious goal to become the world’s fourth-largest arms exporter by 2027. With nearly $14 billion in weapons deals last year and potential for record-breaking exports in 2024, South Korea’s defense industry is on an upward trajectory. The official signing ceremony, held during the World Defense Show 2024 in Riyadh, further cements the strategic defense partnership between South Korea and Saudi Arabia.

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