LIG Nex1 inks $3.2 bn missile defense deal with Saudi Arabia

South Korea's major defense system developer LIG Nex1 Co. has clinched a $3.2 billion deal to export its latest missile interceptor to Saudi Arabia, raising expectations for more similar Korean weapon exports to the Middle East given its push to deter growing militia threats.   

South Korea's and Saudi Arabia's defense ministries on Tuesday revealed that LIG Nex1 signed a $3.2 billion contract with the Saudi Ministry of Defense in November to deliver its missile interceptor system called Cheongung II in Korean, meaning "heaven’s bow," to the Middle Eastern country.

This is the second export deal of the missile interceptor system, known as the M-SAM II, in the region, which has emerged as a major export destination of Korean weapons.

In January 2022, LIG Nex1 won a $3.5 billion deal to sell the M-SAM II system to the United Arab Emirates.

At that time, Saudi Arabia was rumored to have shown interest in the same system.

The oil kingdom has been multiple targets of Yemen Houthi rebels in recent years, making it actively seek to secure defense weapons.

On top of that, considering that the global geopolitical risk is escalating following Russia’s attacks on Ukraine and the Israel-Hamas war, Korean defense companies are expected to bag more similar arms export deals in the region.

KOREA’S PATRIOT SYSTEM

LIG Nex1’s M-SAM II system is a mid-range surface-to-air missile system designed to intercept medium-altitude aerial targets at a range of 40 kilometers and an altitude of up to 15 kilometers.

This is an upgrade to the M-SAM system, with enhanced maneuverability boasting a “hit-to-kill” capability against ballistic missiles. A missile of the system is 4 meters long and weighs 400 kilograms.

Dubbed Korea’s Patriot, the newer system boasts a 100% success rate or target hit rate, according to the company. The Patriot is the US Army’s primary air and missile defense system.

The M-SAM II is a core weapons system of the Korea Air and Missile Defense (KAMD), a key pillar of South Korea’s defense system against North Korea’s ballistic missile attacks.  
Hanwha Systems Co., which makes multi-function radars (MFR) for the M-SAM II system, and Hanwha Aerospace Co., which manufactures the M-SAM II’s launching vehicle, have also joined the latest M-SAM II deal as contractors.

AMBITION TO BE A TOP-TIER GLOBAL ARMS EXPORTER

Korea was the ninth-biggest weapon exporter in the world between 2018 and 2022, according to the global security think tank Stockholm International Peace Research Institute.

However, the country is striving to become the world’s No. 4 arms exporter by 2027 under the direction of the current Yoon Suk Yeol government.

Korean defense companies signed nearly $14 billion worth of weapons deals last year, according to the country’s defense ministry.

Earlier in December, Hanwha Aerospace bagged a $2.4 billion deal to sell 129 Redback infantry fighting vehicles to Australia. In February last year, Korea Aerospace Industries Ltd. (KAI) struck a $920 million contract to deliver 18 FA-50 light attack aircraft to Malaysia.

Considering more arms deal negotiations are underway, Korea is expected to see this year’s arms exports break the previous record and exceed $20 billion.

Several Korean defense companies are currently presenting their weapons systems at the World Defense Show 2024 (WDS 2024) in Riyadh, Saudi Arabia, which started Sunday and runs through Thursday.

LIG Nex1 held an official signing ceremony of its $3.2 billion M-SAM II deal with the Saudi defense ministry on the sidelines of the WDS 2024 on Tuesday.

On Sunday, Korean Defense Minister Shin Won-sik met with Saudi Defense Minister Khalid bin Salman Al Saud and Minister of National Guard Abdullah bin Bandar bin Abdulaziz Al Saud in separate meetings during his visit to the kingdom.

The Korean defense ministry rarely unveils arms sale deals but the latest deal by LIG Nex1 was revealed following the two defense ministers’ meeting.

Write to Dong-Hyun Kim at 3code@hankyung.com


Sookyung Seo edited this article.