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Point Blank Solutions, Inc. (OTC: PBSO) shares moved up sharply on the day after the body armor maker announced that it landed an $86.2 million contract to produce the Improved Outer Tactical Vest (IOTV) for the U.S. Army. The contract calls for the company to produce 150,000 vests at a rate of 25,000 per month for six months, running through December 2008. The award represents a windfall in revenues for the struggling defense company.

Currently, there is an open solicitation for 738,000 IOTVs to complete the Army's acquisition objectives. There was a delay in this process that prompted the need for a bridge buy of 150,000 IOTVs, which is what today's contract represents. Point Blank Solutions is one of two producers of such IOTVs with appoved ballistic material packages. As such, many investors are hoping that the company will win the larger award as well.

"We have continuously proven we have the highest quality, best value products and more capacity than anyone in our industry," said President and CEO Larry Ellis. "Our team firmly believes we are positioned to capture awards from not only the U.S. Army, but other customer segments, both domestically and abroad, especially in light of our recent joint venture, with LifeStone Materials."

Recently, Point Blank Solutions has come under fire from activist hedge fund Steel Partners, who has been trying to force the company up for sale. The hedge fund was prepared to launch a proxy contest when the annual meeting was delayed so that the company could explore its own strategic alternatives. The results of this process remain to be seen, but there are indications that the company has received a lot of interest from potential buyers.

Shares of Point Blank Solutions rose $0.47, or 18.58%, to $3.00 on the news.

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