BAE shares rise on rumoured deal
BAE could win a contract to supply Eurofighter planes to Saudi Arabia, the Times claims
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Friday, 07, Sep 2007 12:22
Shares in BAE Systems, Europe's biggest defence company, rose in early trading this morning after a report claimed the company was in line to secure a £20 billion deal to supply fighter jets to Saudi Arabia.
The UK government sent the contract to supply 72 Eurofighter Typhoon jets to Saudi king Abdullah bin Abdul Aziz two days ago, according to the Times newspaper.
Without citing sources, the paper claimed that the royal leader was expected to sign the contract next week.
However BAE systems said that it was unable to comment on the anticipated deal.
"Negotiations regarding the potential procurement of Typhoon for the Royal Saudi Air Force are between the governments of the United Kingdom and Saudi Arabia and BAE Systems is unable to make any comment as to their content or timing," company spokesman Guy Douglas said.
A Ministry of Defence (MoD) spokesman said that the Times report was based largely on speculation, but confirmed that negotiations over the contract were continuing.
He added that the government expected the talks with Saudi Arabia to conclude later this year.
Reports previously suggested that the Saudis had threatened to cancel the Eurofighter agreement unless a UK corruption probe into an earlier arms deal was dropped.
The Serious Fraud Office (SFO) investigation into the 1980s Al Yamamah deal was dropped in December 2006, on the grounds of national security.
However the US department of justice is continuing with a separate investigation into whether BAE made corrupt payments to secure arms contracts in Saudi Arabia.