Iraq buys LIG Nex1's Cheongung-II missiles for $2.8 billion

LIG Nex1, a Korean defense company, has won a 3.7 trillion won ($2.78 billion) contract with Iraq to export its Cheongung-II missile defense system.

Cheongung missiles on display at a military base in Pohang in 2023. [YONHAP]

LIG Nex1, a Korean defense company, has won a 3.7 trillion won ($2.78 billion) contract with Iraq to export its Cheongung-II missile defense system.

The deal was inked with Iraq's defense ministry, though specific details about the deal are undisclosed for security reasons, according to a regulatory filing. The deal is roughly 1.6 times LIG Nex1's annual sales from last year.

This will be the third export of the Cheongung-II system, following a $3.5 billion deal with the United Arab Emirates in 2022 and a $3.2 billion deal with Saudi Arabia in February.

Cheongung-II is a domestically developed medium-range surface-to-air missile (M-SAM) system designed to intercept ballistic missiles at an altitude between 15 to 40 kilometers (9.3 to 24.9 miles) from the ground.

LIG Nex1 produces the missile and integrated system, while Hanwha Systems supplies the radar and Hanwha Aerospace manufactures the launchers and vehicles.

LIG Nex1 believes the latest deal has opened the door for further exports after securing three major Middle Eastern countries as clients.

“We will strive to ensure this deal enhances Korea’s standing in the global defense industry and creates new opportunities for small- and medium-sized defense firms to expand overseas,” said Shin Ick-hyun, CEO of LIG Nex1.

LIG Nex1 shares closed 211,000 won on Friday, up 2.18 percent from the previous trading session.

BY SARAH CHEA [chea.sarah@joongang.co.kr]