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Raytheon ordered to stop work on U.S. Navy jammer contract

WASHINGTON (Reuters) - The U.S. Navy has told Raytheon Co to stop work on a next-generation electronic jamming system contract the company won on July 8, after BAE Systems Plc formally protested the contract award.

Raytheon Chief Executive William Swanson, disclosing the stop-work order on Thursday, told analysts his company was "very comfortable" about its prospects for holding onto the contract.

He said Navy acquisition officials were very thorough in deciding contract awards and generally prevailed in any protest actions.

"And this is not a competition that happened overnight," Swanson said. "We feel very comfortable in their selection. Of course, we're biased, but we feel comfortable."

BAE last week filed a formal protest against the Navy's decision to award Raytheon a $279 million contract for the next-generation electronic jamming system, a deal that analysts say could be worth billions of dollars in coming years.

The system will be used on EA-18G Growler aircraft, an electronic warfare version of the F/A-18 fighter.

BAE spokesman Brian Roehrkasse said BAE decided to lodge a protest with the U.S. Government Accountability Office because it had "concerns with the Navy's evaluation of our offering." He did not elaborate.

Navy spokeswoman Captain Cate Mueller confirmed the Navy issued a stop-work order on the contract on July 18, as required when a protest has been filed, but declined comment on BAE's claims.

"Until the GAO determines the merits of the protest, which typically occurs within 100 days of a filing, we won't have further comment regarding it," Mueller said.

(Reporting by Andrea Shalal-Esa; Editing by John Wallace and Tim Dobbyn)

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