The UK company Raytheon Systems has unveiled plans for a software operation in Derry which is expected to employ 150 software engineers. The Raytheon announcement was made in Belfast by the managing director, Mr Peter McKee, who said the company had been in discussions with the North's Industrial Development Board for some time.

Mr McKee said Derry had been chosen as the preferred location because of its proximity to the Magee campus of the University of Ulster. Raytheon is currently bidding for three Ministry of Defence contracts, including the Astor (airborne stand-off radar) project in which Shorts is a major partner. Mr McKee said that if Astor did not happen, it was possible that the opening of the facility could be put back by a year or 18 months.

"We are not saying that the new software facility hinges on Astor," he said, "but it would mean that we could progress the plan at a much earlier stage. At present we don't have sufficient work to justify starting this programme." The company is also hoping to secure two further defence contracts, one of which is connected to the development of a missile system for the Eurofighter. Mr McKee said one of the advantages in setting up in Northern Ireland was that it already had a well-developed software industry. "The Northern Ireland education system is producing some highly qualified technologists," he said, "and we have been impressed by the skills available to us."