Defense Minister Sen. David Johnston said the SEA1442 Phase 4 Acquisition Contract, valued at nearly $188 million, "will deliver a significant improvement" to the communications capability of the vessels.
Upgrading will include new radio and switching systems, secure voice and tactical communications system and a communications management system.
"This new system will allow high-speed networking of ships within a task group as well as more efficient and effective communications from ship to shore," Johnston said.
Selex's systems for the long-range escort ANZAC ships will be similar to those being used by the navies of the United Kingdom, Canada and the United States.
Under the contract Selex ES, a United Kingdom company, will set up Selex ES Australia in Melbourne to deliver the project and provide ongoing support.
Johnston said Selex was selected through an open tender process with the first upgraded ship planned to enter service in 2018.
The contract also will provide job opportunities in Melbourne for engineers, project managers, logisticians and other specialists in military communications and in-service support.
Opportunities will exist for Australian industry through sub-contracts to small-to-medium enterprises in the fields of systems integration and engineering, project management, integrated logistics and ship installation.
"A separate five-year in-service support contract, valued at nearly $18 million, will provide logistics, supply, training, engineering and maintenance support services for the sustainment of the delivered capability," he said.
The ships, built by AMECON in Australia, were commissioned from 1996-2001 and have the capability to carry Sikorsky S-70B-2 Seahawk helicopters.
Australian navy information notes the ships' main armaments include a 127mm gun, a torpedo system and an MK41 vertical launch system for the Sea Sparrow missile, made by Raytheon and General Dynamics.
The ships are based on the Meko 200 frigate design from German shipbuilder Blohm and Voss. They have a range of 6,000 nautical miles and a speed of 27 knots from a combined diesel-gas power plant.
The engines are a single General Electric LM2500-30 gas turbine and two MTU 12V1163 TB83 diesel engines.
Australia's procurement agency Defense Materiel Organization finalized an ANZAC Ship Group Maintenance Contract with Naval Ship Management in June last year.
The five-year deal for the eight vessels is worth around $467 million in total to NSM, a 50-50 joint venture between UGL and Babcock's Australian division, a statement from UGL said.
The contract also allows for a 10-year extension based on performance.
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