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French group wins $35.5B defense deal from Australia

12 February 2019

Under the IGA, the 12 subs, save for some specialized parts, will be built in Adelaide in South Australia, home to the Australian Submarine Corporation (ASC).

The Australian government has signed an agreement with French Naval Group to build 12 attack class submarines worth 50 billion Australian dollars ($35.5 billion) for the Royal Australian Navy, the Australian defense minister said on Monday.

Negotiations on the SPA began in early 2017 and were meant to have been completed during that year, but was delayed by issues including the length of warranty periods and the implications of a possible merger between Naval Group and Italy's Fincantieri.

The formal signing of the agreement is a "defining moment for the country", the statement said.

The attack class submarines are a major part of Canberra's AUD 90 billion national shipbuilding plan put in place to meet the 2016 Defence White Paper, a statement issued by Australia's Minister of Defence Christopher Pyne noted.

The announcement had been made by the federal government after the official inking of the deal - the Attack class submarine Strategic Partnering Agreement.

"We are very excited about the opportunities that lay ahead of us and are committed to delivering the Future Submarine Program for Australia".

"The formalisation of this agreement represents the contractual basis for the program". The transfer of technology commenced with the relocation of the first group of Australian engineers to France to learn how to carry out the detailed design of the Future Submarines.

According to Naval Group, suppliers of the top five pieces of equipment - the main motor, diesel generators, switchboards, batteries and weapons discharge systems - have been reviewed and will be announced this year.

Australia and France will now move on to swiftly conclude the design contract.

French group wins $35.5B defense deal from Australia