The four-year deal will create 110 jobs at Cook’s base in Stanhope, County Durham, where the company produces metal bands, or tracks, that are installed on armoured vehicle wheels.
UK Defence Secretary Michael Fallon said: "This contract is good news. It continues a long and proud tradition by The William Cook Group, which has been providing track and armour for British tanks since the second world war.
"It is part of our £166bn plan to ensure our armed forces have the equipment they need. It will sustain jobs here in the North East and hundreds more within the wider UK supply chain."
Under the contract, CDS will design and build track systems for the army’s 62t Challenger 2 main battle tank, the Warrior infantry fighting vehicle and the Scimitar reconnaissance vehicle.
Northern Powerhouse Minister James Wharton said: "Helping the North reach its potential for local people living and working here is exactly why we are committed to creating a Northern Powerhouse.
"Therefore I am delighted that this contract, which will help provide jobs whilst supporting our armed forces, has been secured."
Cook Defence Systems is a part of the William Cook Group, which also manufacturers high-integrity steel castings and structural parts for fighting vehicles, ships, and submarines.