In the early 1970s the British Royal Navy recognised that there would be a requirement to replace the Sea King towards the end of the century. This led to the signing in 1979 of a Memorandum of Understanding between the Italian and British Governments to co-operate in the joint development of a medium lift helicopter to fulfil the roles of shipborne Anti-Submarine and Anti-Surface Warfare, military utility and civilian transport. IN 1980 Agusta and Westland formed a 50/50 joint company called EH Industries to manage the program.

In its original Staff Requirement, the Royal Navy specified some key performance markers for a Sea King replacement. The first was speed and endurance to allow operations at extended ranges and to permit quick reaction to, and attack on, submarine targets. The second feature was an integrated mission system to process data from a suite of sensors to give the helicopter an independent capability to search for, locate and attack targets. Versatility was a third key requirement to enable the helicopter to carry out a wide variety of roles and respond quickly to emergency tasking in flash points around the world. Agility was the final characteristic. The helicopter had to have sufficient power, maneuverability and control margins to allow safe operations from frigate-sized flight decks in demanding weather conditions, day and night.

The EH101 program was given the go-ahead by the British and Italian Governments with the signing of an agreement on January 25th 1984. This provided for joint funding of the project through development to the production stage.

The fourth UK/Italian MoU was signed on September 30th 1991, which started the industrialization phase.

The Royal Navy's Merlin purchase was to meet Staff Requirement (Sea) 6646, which called for 66 aircraft.

In September 1991 GKN Westland ceased to be prime contractor for the RN's Merlins, when the contract was awarded to IBM in Owego, New York. IBM later sold its Federal Systems Division (or which IBM Owego was a part) to Loral, which was purchased by Lockheed in 1996. IBM Owego had previous experience of naval helicopters as it had been prime contractor on the US Navy's LAMPS Mk III program.

Canada ordered 35 naval EH101s (designated CH-148) and 15 SAR versions (designated CH-149) on July 24th 1992 to replace its CH-124 Sea Kings, in a program worth CDN$5.8bn. In August 1993 seven CH-148s were eliminated as a cost-saving measure, but a new government in Ottawa cancelled the whole contract on November 4th 1993.

The EH101 was announced the winner of Staff Requirement (Air) 440, an RAF requirement for a Wessex support helicopter replacement, on March 9th 1995.

In August 1995 Kawasaki Heavy Industries and Okura & Co of Japan joined the EH101 marketing team.

The Italian government announced an order for 16 EH101s with options on 8 more in October 1995.

The EH101 achieved its first export order in 1997 for a single civil utility (rear-ramp) version to be delivered to the Tokyo Metropolitan Police.

The Canadian government announced a CDN$580m order for 15 search-and-rescue versions of the EH101, to be known as the CH-149 Cormorant, for the Canadian Forces on January 5th 1998. On April 24th 1998 the DND announced that the contract had been finalised. On June 10th 1998 GE Aircraft Engines Canada signed a CAN$60m contract with EHI to supply T700/T6A1 engines for the Canadian Cormorants.

The UK Strategic Defence Review, published in July 1998, stated that the Royal Navy would not receive more than the 44 Merlin HM.1s already on order.

In July 2000 GKN Westland and Agusta agreed to merge their helicopter business, with the resulting company being called "AgustaWestland".

In August 2000 the Canadian Government gave the Department of National Defence the go-ahead to proceed with the acquisition of a suitable replacement for the Sea King helicopter. The main contenders for the contract were the EH101, Eurocopter's Cougar, and Sikorsky's MapleHawk.

On November 8th 2000 it was announced that EHI had signed a teaming agreement with Danish companies TERMA Elektronik A/S and TERMA Industries Grennae. This is part of EHI's bid to win the Nordic Standard Helicopter Programme competition, in which Norway, Sweden, Finland and Denmark had combined to issue a joint requirement for SAR and troop transport helicopters.

On September 14th 2001 the Danish Ministry of Defence announced the selection of the EH101 as the type which best met the requirements of the country's armed forces. Denmark will procure 14 helicopters for search and rescue and tactical troop transport, in a contract worth about €380 million. The other three participants in the NSH Programme opted for the NH90 instead.

On December 3rd 2001 the Portuguese government announced that it had selected the EH101 to fulfill Search and Rescue and fisheries protection roles. The twelve aircraft to be procured will cost approximately €300 million, and will replace Portugal's ageing fleet of Pumas.

The formal contract to supply 14 EH101s to the Royal Danish Air Force was signed on December 9th 2001. The aircraft will be built at Westland Helicopters' Yeovil facility.

At Farnborough International 2002 Lockheed Martin and AgustaWestland announced the setting up of a formal team to make and market the EH101/Merlin in the USA. A top target is the US Marine Corps' "Marine One" helicopter requirement to fly the US President, with the extra safety margin of the helicopter's three engines being a big selling point. The high cabin roof, allowing passengers to stand up inside the Merlin, is also a big plus in the Presidential transport role.

Replacing USAF combat search and rescue HH-60 Pave Hawk helicopters is perhaps the biggest potential order for the Merlin in the US, with possible sales of 132 machines involved. Lockheed Martin is also pitching the Merlin to replace Vietnam-era UH-1 Hueys used to fly rapid reaction patrols protecting US nuclear ballistic missile fields.

The Merlin is also considered a strong contender to win orders from the US Coast Guard (USCG) for long-range search and rescue helicopters required under the service's Deepwater equipment programme. It is likely that the Merlin would be considered for search and rescue work in Hawaii and Alaska, where long missions over sea and the Arctic are required.

On May 15th 2003 AugustaWestland Inc announced that it had reached agreement with Bell Helicopter to form a Joint Venture company to manufacture the US101 helicopter in America.

The JVC will act as a subcontractor to Lockheed Martin which, as prime contractor and systems integrator, will have overall responsibility for the program and delivery of the US101 helicopter to the customer.

On June 5th 2003 CKN Westland announced that the Japan Maritime Self-Defence Force had selected the EH101 to replace its fleet of MH-53Es and S-61s. Fourteen aircraft are expected to be procured.

On February 2nd 2004 Team US101, a partnership of Lockheed Martin, AgustaWestland and Bell Helicopter Textron, submitted a proposal to Naval Air Systems Command to provide the President of the United States with a new Marine One helicopter fleet. In the event of the US101 being selected to meet the VXX requirement, Lockheed Martin would be prime contractor and systems integrator, AgustaWestland would design the aircraft, and Bell Helicopter would assemble the airframe in Texas. The US101 will be powered by the GE Aircraft Engines CT7-8E engine. The US101's only competitor for the VXX requirement is the Sikorsky S-92.

On July 23rd 2004 the Canadian Department of National Defense announced that the Sikorsky H92 had been selected to fill the 28-aircraft MHP requirement.

According to the "Globe and Mail", the Canadian government concealed the fact that it was forced to buy Sikorsky helicopters to replace its fleet of Sea Kings after the only other competitor in the $5-billion race (Team Cormorant) had been previously disqualified on technical grounds.

On September 22nd 2004 it was announced that Team US101 had responded to the U.S. Navy�s request for an updated proposal offering an executive transport variant of the US101 medium-lift helicopter for the Presidential Helicopter Replacement (VXX) program.

On January 28th 2005 the US Navy announced that the VXX competition had been won by Team US101. The contract requires five aircraft to be delivered by 2009, and the remaining 15 by 2015.

The selection of the US101 as the winner of VXX is potentially one of the most significant acquisition decisions made by the Pentagon for decades. For the first time, a European-made system was selected when a competitive, US-made alternative was available. In all previous European contract wins, US industry either lacked what the Pentagon was looking for, or could not make it competitively.

For Lockheed Martin, the VXX win is likely to lead to other contracts from the US military. The $6.1 billion VXX contract funds development of new capabilities for the US101, including re-design of the tail rotor and increasing range to 350 nautical miles, which will make it even better suited to meet future military requirements. The most significant of these is the PRV combat search and rescue program, which calls for between 100 and 200 helicopters, and where range and cabin volume are the major requirements.

On June 2nd 2005 Team US101 announced that it had signed a teaming agreement with Northrop Grumman's Defensive Systems Division to support the team's bid to win the US Air Force's upcoming Personnel Recovery Vehicle competition. Under the terms of this agreement, Northrop Grumman will provide and integrate critical mission systems equipment for the US101 helicopter. The company will also support the spiral growth of these systems during the life of the PRV program. A similar agreement was signed with ITT on June 7th 2005.

On June 15th 2005 Lockheed Martin awarded General Electric Company a $50 million contract to provide CT7-8E engines for use during the system development & demonstration (SDD) phase of the Presidential Helicopter Replacement program. Work under this contract will begin immediately and continue through 2008.

On July 7th 2005 the US101 was given the mission design series designator of "VH-71A". A popular name for the aircraft had not been assigned but an earlier report suggested it would be "Kestrel".

On June 26th 2007 the British and Danish governments signed a memorandum of understanding to transfer six state-of-the-art Merlin helicopters from Denmark to the UK. They will be modified by AgustaWestland to British HC Mk3A standard, with BERP IV main rotor blades and defensive aids, and will be ready for operations in 2008.

The UK MoD has also entered into a contract with Agusta Westland to produce six new Merlin helicopters for Denmark as a replacement for the six transferred at a cost of £174.7m

Rumours of an Algerian order for the EH101 eventually came to fruition on November 20th 2007, when an order for six, along with four Lynx Mk300s, was announced by AgustaWestland. Deliveries will begin in 2009.

In August 2008 the Indian Air Force announced that it had selected the EH101 as the service's next VIP helicopter in competition with the Sikorsky S-92.

On March 11th 2010 AgustaWestland announced that the Indian government had signed a contract worth about $560m for 12 AW101s.

Following the cancellation of the Lockheed Martin/AgustaWestland VH-71 for the original VXX requirement, Boeing announced on June 7th 2010 that it had reached an agreement with AgustaWestland to obtain a license for U.S. production of the AW101 helicopter in order to offer it to the U.S. government for the second attempt at a next generation presidential helicopter.

On September 18th 2012 Northrop Grumman Corporation and AgustaWestland announced that they had signed a comprehensive teaming agreement to respond to anticipated requests for both the new U.S. Air Force Combat Rescue Helicopter and the U.S. Navy's recently announced program to develop a new "Marine One" presidential helicopter. A U.S.-built helicopter based on the AW101 platform will be offered by Northrop Grumman to meet these requirements.

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