United Defense's Virginia Shipyard Wins Amphibious Assault Ship Contract Potentially Worth $228 Million

Contact:
Doug Coffey, Media
United Defense
doug.coffey@baesystems.com
(703) 312-6121

Jackie Kreisler, Media
United States Marine Repair
kreislerj@baesystems.com
(619) 557-4289

NORFOLK, VA, January 4, 2005 - United Defense Industries, Inc. (NYSE:UDI) announced today the award to NORSHIPCO, its Norfolk, Va., shipyard, of a five-year, Multi-Ship, Multi-Option (MSMO) cost-plus incentive-fee contract, potentially worth $228 million.

NAVSEA, the contracting facility, awarded the work on the six LHA and LHD class of amphibious assault ships home ported in Norfolk. The initial $350,000 award is for advance planning on the first ship in the contract, the USS SAIPAN (LHA 2). The work package, scheduled for completion in 2010, includes the performance of pier side availabilities in the private sector facility and dry docking availabilities in the public shipyard. Additionally there will be continuous maintenance between planned availabilities. If the Navy exercises all options, the value of the contract could reach $228 million.

"Award of this contract validates the performance of our workforce and our business model of partnering in the port of Norfolk,” said Tom Epley, NORSHIPCO'’s president and general manager. "The flexibility of this contract method enables the Navy to efficiently use their maintenance funds by level loading the port and providing a more secure employment outlook for the workers of the Norfolk ship repair community."

About United Defense
United Defense designs, develops and produces combat vehicles, artillery, naval guns, missile launchers and precision munitions used by the U.S. Department of Defense and allies worldwide, and provides non-nuclear ship repair, modernization and conversion to the U.S. Navy and other U.S. Government agencies. To learn more about United Defense, visit http://www.uniteddefense.com.

Forward-Looking Statements
Information in this release may involve guidance, expectations, beliefs, plans, intentions or strategies regarding the future. These forward-looking statements involve risks and uncertainties. All forward-looking statements included in this release are based upon information available to United Defense Industries, Inc., as of the date of the release, and we assume no obligation to update any such forward looking statements. The statements in this release are not guarantees of future performance and actual results could differ materially from our current expectations. Numerous factors could cause or contribute to such differences. Please refer to the Company's Annual Report on Form 10 K for the year ended December 31, 2003 as well as its Quarterly Report on Form 10 Q for the quarter ended September 30, 2004, and in our other reports filed from time to time with the Securities and Exchange Commission for a further discussion of the factors and risks associated with our business.