By Sabine Siebold
BERLIN (Reuters) - Germany's defense ministry on Tuesday told lawmakers that it would not complete a contract for a multi-billion euro new missile defense system with European arms maker MBDA during the current legislative period, as planned, ministry sources said.
Ministry officials remain committed to concluding a contract with MBDA for the Medium Extended Air Defence System that will replace the current Patriot air and missile defense system, but said there was still work to do on MBDA proposal, as well as how the overall project would be managed, the sources said.
Regardless of the MEADS outcome, the ministry also plans to spend several hundred million euros to modernize the software and hardware of the German military's existing Patriot system, which was built by Raytheon Co (N:RTN), the sources said.
The delay in the MEADS project marks another setback for Defence Minister Ursula von der Leyen, who has sought to reform Germany's troubled weapons procurement process since taking office in late 2013. A second multi-billion euro program to build a new multi-role ship has also been delayed.