By Wiktor Szary and Marcin Goettig
WARSAW (Reuters) - Poland said on Tuesday it would buy Raytheon Co's Patriot missiles from the United States and provisionally selected French Airbus Group (PARIS:AIR) helicopters as it speeds up the modernization of its military amid tensions with Russia.
The choice of suppliers, in deals potentially worth $8 billion, strikes a trans-Atlantic balance as Eastern Europe's largest economy re-arms itself on NATO's frontline while edging toward a bigger role in Europe's defense industry.
"For the armed forces' technical modernization and the Polish armed forces' resilience to be effective, the so-called anti-missile shield ... had to become the priority of priorities," said Polish President Bronislaw Komorowski.
Poland will enter exclusive talks with the U.S. government on the Patriot missile defense system. It plans to buy eight missile batteries by 2025, including two within three years of signing.
A consortium of France's Thales and European group MBDA was also competing for the $5 billion missile defense contract - the largest in Poland's military history.
The United States said it welcomed the announcement from its stalwart NATO ally.
The program "is expected to generate at least $2.5 billion in U.S. export content - that means supporting American jobs at home and growing our manufacturing base," U.S. State Department spokeswoman Marie Harf said in a statement.
Poland, a NATO member since 1999, had accelerated the process to select a supplier for the missile system after Russia's annexation of Ukraine's Crimea Peninsula last year prompted great concern among NATO members in Eastern Europe.
Since the end of the Cold War, Poland has usually kept closer defense and security ties with the United States.
But in the past few years, policymakers have been lobbying for a stronger security relationship with the rest of Europe, especially after the Obama administration scaled back its missile defense shield plans in Eastern Europe.
AIRBUS STATUS
Poland also named the Caracal EC725 of Airbus Helicopters as its preferred choice in a $3 billion utility helicopter tender, subject to army testing, dropping U.S. and Italian competitors.
It trimmed the potential order from an original 70 helicopters to 50. This would still represent Poland's biggest defense acquisition from Western Europe since the end of the Cold War. Deliveries could begin as early as 2017.
The helicopter decision was seen as delicate because rival bidders Sikorsky, United Technologies Corp (NYSE:UTX)'s helicopter unit in the United States, and AgustaWestland, owned by Italy's Finmeccanica, have factories in Poland whose unions had warned of job losses.
A French defense official said the Caracal helicopters and their Turbomeca engines would both be assembled in Poland as part of a wide-ranging industrial pact. Airbus has offered what could evolve into "fifth nation" status for Poland alongside its Western European founders to support its bid.
The official said Poland had monitored France's decision last year to suspend delivery of warships to Russia over its role in the Ukraine crisis, but denied any explicit link between that move and Poland's decision to buy French hardware.
Poland said that because of "changing security circumstances," it had decided to speed up a separate acquisition of attack helicopters.
Four companies have expressed interest in supplying some 30 units in a deal already brought forward by two years in light of the crisis in Ukraine.