Blackwater, out of spotlight, growing

WASHINGTON, May 18 (UPI) -- U.S. security contractor Blackwater has overcome a rash of negative publicity to record steady business growth, The Raleigh (N.C.) News & Observer said Sunday.

The private security firm, based in Moyock, N.C., came under intensified public scrutiny after guards in its employ in Iraq killed 17 Iraqi civilians in Baghdad.

Fallout from the incident included congressional hearings, at which Blackwater owner, Erik Prince, testified. The company initiated a public relations blitz, and its PR troubles have largely subsided, the newspaper said.

The U.S. State Department has renewed its contract with Blackwater to protect diplomats in Iraq, and the firm won a $92 million military contract to fly soldiers and cargo around Afghanistan, Pakistan, Kyrgyzstan and Uzbekistan.

Blackwater grew from having $204,000 in federal contracts in 2000 to almost $600 million in 2006, the newspaper reported.

The company has hired former officials from the CIA, Defense Department and State Department, and it named the former No. 2 official at the CIA to its board, the report said.

"Their connections certainly help a lot," said Peter Singer, an expert on military contractors at the Brookings Institution. "But they may be a vulnerability in the future, if the regime changes in Washington."