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London/Paris: Saudi Arabia has suspended commercial negotiations with the United Kingdom over the £10 billion (about Dh71 billion) purchase of a new fleet of Eurofighter Typhoons, in a last-ditch attempt to force the conclusion of a long-running corruption investigation.
Mike Turner, chief executive of BAE Systems, Britain's biggest weapons maker and prime beneficiary of the Saudi deal, said yesterday: "We cannot speak on behalf of the two governments. But I do know we are not currently moving forward on finalising the Typhoon contract."
For more than two years, Britain's serious fraud office (SFO) has been investigating allegations of unethical practices surrounding the 20-year-old Al Yamamah oil-for-arms agreement with Riyadh, the UK's biggest export deal.
The deal to purchase 72 Eurofighters would supersede the Al Yamamah contracts and could eventually be worth as much as £40 billion (about Dh286 billion) to BAE. A similar sum has been made from Al Yamamah, where BAE supplied Tornado fighter jets, among other military equipment.
But the SFO's decision to seek bank account information from Switzerland, in relation to its Al Yamamah investigation, has sparked anger in Riyadh, leading to a temporary suspension of commercial talks.
Officials from Britain's ministry of defence and BAE have said the Eurofighter deal is under threat, with the Saudis poised to sign a deal with the French to buy 24 or 36 of the rival Rafale jet.
However, French military officials and independent defence experts said the kingdom was unlikely to cancel the British deal.
Shares in BAE fell about 3 per cent to 391p in London yesterday on worries about the Eurofighter deal.
The SFO declined to comment, beyond saying that its investigation continued.
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