Development of an air-to-air missile to replace the AIM-9B Sidewinder in FAB service began in March 1976 by Brazil's Instituto de Aeronáutica e Espaço (IAE). By 1978 it had been defined as a weapon similar in capability to the AIM-9G. The project was classified until 1981. The pace of the project was quickened after the 1982 Falklands war and the missile was dubbed Piranha. Contracts were awarded to DF Vasconcellos SA, a Brazilian company with experience in optics and guided weaponry which was given the task of developing the weapon's infra-red seeker. However the company went bankrupt in the mid-1980s and it abandoned the Piranha project in 1986.