The U.S. Navy said on Wednesday it issued a stop-work order to Raytheon Co on a next-generation Air and Missile Defense Radar (AMDR) valued at $1.6 billion after Lockheed Martin Corp filed a protest of the contract award.
Navy spokeswoman Commander Thurraya Kent declined to comment on the protest or the contract decision.
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"The contract was awarded following a full and open competition," she said.
Lockheed, the Pentagon's top supplier and maker of the Aegis combat system, said on Tuesday that it had filed a formal protest with the Government Accountability Office against the U.S. Navy's contract award to Raytheon.
Raytheon said it remained confident in its proposed solution. "We're eager to move forward and deliver this much needed AMDR capability to the Navy," said spokesman Dave Desilets. "We'll trust the process and will work closely with our customer to mitigate any resulting delays once resolved."
Lockheed spokesman Keith Little said Lockheed decided to challenge the Navy contract award because it did not believe the merits of its bid had been properly considered during the Navy's evaluation process. He said Lockheed's bid was technically compliant and offered "a very affordable price."
The GAO, an arm of Congress that oversees disputes about federal contract awards, has 100 days to review the protest. Its ruling is expected by January 30.
Earlier this month, Raytheon beat out Lockheed and Northrop Grumman Corp to win the contract to design a next-generation air and missile defense radar for use on the Navy's Aegis destroyers starting in 2016.
(Reporting by Andrea Shalal-Esa; Editing by Maureen Bavdek, Bernard Orr)