Britain Reaches Eurofighter Price Deal with Saudi

Britain has reached an agreement over the rising cost of providing Saudi Arabia with Typhoon Eurofighter jets, British defense company BAE Systems said on Wednesday.

BAE, working in close co-operation with the British government, signed a £4.5-billion deal in 2007 to supply 72 Eurofighter Typhoon jets to Saudi Arabia. Even though some planes have been delivered, the contract has faced obstacles over rising costs.

"Both governments have now agreed price escalation terms relating to the Typhoon aircraft under the Salam program," BAE said in a statement.

BAE, which did not give any precise figures, added that cash settlement was expected to follow the new pricing agreement.

"This is an equitable outcome for all parties," said BAE Systems chief executive Ian King.

"I am pleased that we have been able to conclude this negotiation which builds on our long standing relationship with this much valued customer."

BAE builds the Typhoons in co-operation with European aerospace giant EADS and Italy's Finmeccanica.