LONDON/DAVOS: Defence company BAE Systems said it was making progress on a deal with Saudi Arabia over the pricing for Eurofighter jets and was seeking other buyers for the aircraft after the collapse of a potential sale to the United Arab Emirates.
BAE’s Chief Executive Ian King said a series of other bids with other air forces had been put in. Current orders, including a deal with Oman for 12 aircraft, would guarantee that the manufacturing line will stay busy till 2018, King, speaking to reporters in London on Wednesday, said.
BAE shares lost about five percent on December 20, the day after it announced the end of talks with the UAE over a potential $9.8bn Eurofighter deal and said that Saudi talks had still not been resolved. The shares have since recovered that value.
“Watch this space,” BAE’s chairman Richard Olver said in an interview with Reuters Insider in Davos when asked when investors should expect a resolution to the long-running price negotiations with the Saudis.
“We’re always talking to our most important customers and Saudi is a very important customer,” he said, when asked if discussions were taking place this week.
The continued delay of the so-called Salaam deal for Eurofighter jets has pushed BAE to repeatedly trim its full-year earnings forecasts. JP Morgan Cazenove analysts said last month that the failure to reach agreement was perplexing.
King attributed the UAE’s withdrawal to the country’s conclusion that the deal could not be made within its budget and the required time scale, but said despite this the relationship between the UAE, Britain and the company remained very good.
Reuters
