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Marine Log

January 14, 2008

Northrop Grumman to combine Newport News and Ship Systems

Northrop Grumman Corporation (NYSE:NOC) today announced what it called "a strategic realignment" of several of its operating sectors that will see its two shipbuilding sectors, Newport News and Ship Systems, become a single sector called Northrop Grumman Shipbuilding, effective Jan. 28, 2008. It says it does not anticipate any facility closures or significant reductions in yard employment levels to result.

C. Michael Petters, currently corporate vice president and president of Newport News, has been elected corporate vice president and president of Northrop Grumman Shipbuilding.

Philip A. Teel, currently corporate vice president and president of Ship Systems, has been elected corporate vice president and president of the company's Mission Systems sector effective April 1, 2008.

The Missions Systems sector will, from July 1, be focusing on the C4ISR (Command, Control, Communications, Computers, Intelligence, Surveillance and Reconnaissance) business as reporting of the corporation's missiles business will move from the Mission Systems sector to the Space Technology sector

Northrop Grumman Chairman and CEO Ronald D. Sugar says the "strategic realignment" will "enhance our world-class military shipbuilding enterprise and provide an integrated interface and full range of capabilities to our customers."

"With the significant progress in the recovery and regeneration of our Gulf Coast shipyards following Hurricane Katrina, the improvements resulting from our investments in our yards, and the continued strength of our nation's military shipbuilding program, this realignment positions the company for the future," Sugar said.

"Mike Petters brings extensive shipbuilding expertise and broad management experience to his new role as we leverage our capabilities, resources and talent to enhance our shipbuilding powerhouse," Sugarnoted.

The realignment and transition process for the new Shipbuilding sector is expected to continue throughout 2008.

Petters will assume day-to-day responsibility for the Gulf Coast operations of Shipbuilding and will operate from Pascagoula, Miss., during this transition phase.

"All current Gulf Coast and Newport News customer interfaces, as well as internal management and financial reporting structures, will remain in place until specific changes are communicated," says a Northrop Grumman press release issued today. "The company is committed to ensuring a smooth transition with a focus on meeting all its program execution, safety and customer commitments. The company does not anticipate any facility closures or significant reductions in yard employment levels as a result of this realignment."

Petters, 48, joined Newport News in 1987 in the submarine construction division. His assignments at Newport News have included nuclear ship design and construction, contracts, human resources and management of the shipbuilding trades, culminating in his election as corporate vice president and president in 2004.

Petters graduated from the U.S. Naval Academy in 1982 with a bachelor's degree in physics. He served as an officer aboard the USS George Bancroft before joining the Naval Reserve in 1988. He earned a master's degree in business administration from the College of William and Mary in 1993.

Northrop Grumman Shipbuilding is the world's leading military shipbuilder, with approximately $5.5 billion in revenues and nearly 40,000 employees.

Northrop Grumman Corporation is a $31.5 billion global defense and technology company with 122,000 employees.

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