The contract is worth �1 billion with almost one fifth to be handled by the Space units of EADS.

The contract between ESA and Galileo Industries covers the development and construction of the first four Galileo constellation satellites and part of the ground infrastructure for Galileo, including the full testing of the subsystem.

"This contract clears the way for Europe to establish its own satellite navigation system," said Evert Dudok, CEO of EADS' Space transportation activities and member of the Supervisory Board of Galileo Industries.

"Galileo is a key project, not only for the Space industry but also for Europe as a whole. That is why I am especially pleased that EADS Space is playing such a central role in this project." EADS Space has a 38 percent holding in Galileo Industries and is thus one of the largest shareholders in the company.

The In Orbit Validation (IOV) phase is designed to test the new European satellite navigation system under real mission conditions. Between now and 2008, four satellites will be delivered - this is the minimum number required to verify the accuracy of the positioning signals. In operation, this subsystem will demonstrate the system's capabilities ahead of the full 30 satellite constellation which should be fully operational before the end of the decade.

During this IOV phase, EADS Astrium in Ottobrunn near Munich will assume system leadership for the Space segment and take overall responsibility for the construction of the first four satellites. In Ottobrunn, important components such as the attitude control system will be designed and manufactured.

Together with Dutch Space, a future subsidiary of EADS Space based in the Netherlands, EADS Astrium in Ottobrunn will also provide the solar arrays for the four satellites. The propulsion units for the four satellites will come from EADS Space Transportation in Lampoldshausen.

Responsibility for the payload on board the four satellites and also the ground control segment, which provides satellite control, lies with EADS Astrium in the United Kingdom. EADS Astrium in Portsmouth will assume system responsibility for the globally deployed ground control segment covering the 30 satellite constellation in orbit.

In addition Portsmouth will design and manufacture the onboard navigation payload, which generates and transmits the navigation signals to users, and also important equipments such as the solid state power amplifiers.

EADS Space in France and Spain will also contribute to the IOV phase. EADS Space France is involved in the ground mission segment. Spanish EADS Space companies will contribute the navigation antennas and are involved in the Space segment system engineering.

Galileo is a joint programme undertaken by the European Union and ESA. The aim is to set up an innovative state-of-the-art global satellite navigation system that will offer high-precision positioning services. Galileo will be under civil control and end Europe's dependence on the military-controlled GPS.

EADS Space Services is another major participant in the Galileo project. The company, which specialises in providing Space services, is a member of the international consortium that is currently negotiating to become the Galileo 'concessionaire'. The concessionaire will work within a Public Private Partnership (PPP) to set up the entire Galileo navigation system of 30 satellites following the IOV phase and then operate it for 20 years.

In December 2005, the nations and companies involved agreed on the allocation of the key tasks and sites for the Galileo operations phase, thus clearing the way for a concession contract to be concluded in the near future.

The Headquarters of the Galileo Concessionaire will be located in Toulouse, France. The Operations Company will be located in London, United Kingdom. The two Control Centres (Constellation and Mission) will be located In Germany and Italy, as will the two Performance Evaluation Centres. A backup Control Centre will be located in Spain.

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