Elbit Systems unit to keep Boeing work in Carmiel

Sources inform ''Globes'' that Elbit Systems Ltd. (Nasdaq: ESLT; TASE: ESLT) subsidiary Cyclone Ltd. plans to hire 20 new employees for its Carmiel plant over the coming months, belying reports that the company was going to move some production lines to Romania, which could have resulted in local layoffs.

The reports about the supposed move originated in a letter that Haifa Mayor Yona Yahav sent to Elbit Systems chairman Michael Federmann asking him not to move production of components for a contract to Romania, and to keep production in Israel. Sources familiar with the subject told "Globes" that Yahav was apparently unfamiliar about the details, because Elbit Systems did not have any intention of transferring production from Israel to its Romanian facility.

Elbit Systems has in fact decided to produce a small part of an order from Boeing Company (NYSE: BA) at the company's Romanian facility, but most of the order will be carried out at the Cyclone plant in Carmiel. There was never any decision to transfer a production line to Romania.

Cyclone employs 450 people at its Carmiel plant. The false reports about the transfer of a production line to Romania caused worries about layoffs.

An Elbit Systems official told "Globes", "Elbit Systems utterly rejects these claims that the company is moving production lines overseas, and regrets that the issue was not first checked with it before being sent to the media."

Published by Globes [online], Israel business news - www.globes-online.com - on September 16, 2009

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