Saudi Arabia Agrees On U.K. Deal To Buy Eurofighter Jets

Posted on: Aug. 18th, 2006 || Source: money.aol.com | E-mail Article | Print Article

Saudi Arabia Agrees On U.K. Deal To Buy Eurofighter Jets

LONDON (Dow Jones) -- Saudi Arabia and the United Kingdom have agreed in principle on a deal, reportedly valued at 10 billion pounds ($18.9 billion), that paves the way for the Middle East nation to purchase a fleet of Eurofighter Typhoon aircraft.

The deal would represent a boost for BAE Systems (BAESY) , the U.K.'s biggest defense company and one of the main contributors to the Eurofighter program. Shares of BAE Systems climbed 3% in London.

In a statement, the U.K.'s defense ministry said the two countries' agreement is "intended to establish a greater partnership in modernizing the Saudi Arabian armed forces."

"The required commercial principles have now been agreed, which has initiated the purchase of Typhoon aircraft," the ministry added.

BAE Systems said in a statement it welcomed the deal, but a spokesman for the firm declined further comment, saying the deal is still just between the two governments.

The Financial Times reported that the Saudi air force intends to buy 72 Eurofighter jets for about 5 billion pounds. Along with missiles and spare parts, the total initial value of the deal would reach about 10 billion pounds.

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