LDO Leonardo SpA

By Robert Wall

LONDON--Austria's defense ministry Thursday said it would pursue legal charges against Airbus SE (AIR.FR) over a controversial deal more than a decade ago to buy Eurofighter Typhoon combat jets.

A spokesman for Austria's Ministry of National Defense and Sports said the government would bring a case against the European aerospace giant. Details are due to be presented by the minister later Thursday, he said.

In 2003, Airbus, then still called European Aeronautic Defence & Space Co., won a deal for the Eurofighter GmbH consortium to supply 18 fighter planes to Austria. The combat plane making consortium also includes BAE Systems PLC (BA.LN) and Leonardo SpA(LDO.MI).

Suspicions of corruption in the Austrian deal have been raised repeatedly since 2002, but remained unsubstantiated until 2006, when a parliamentary committee in Vienna identified chains of suspect payments apparently related to the Eurofighter sale, but little evidence of the intention behind the payments.

The parliamentary probe succeeded, however, in raising political questions that ultimately prompted the Eurofighter consortium and the Austrian government to renegotiate the sale, including cutting the size of the purchase to 15 planes. The contract value was reduced to about 1.6 billion euros ($1.7 billion) from around EUR2 billion.

Airbus Thursday said it couldn't comment on the reports of legal action, saying it wasn't certain what they were based on. However, it added "in recent years we have supported the activities by the legal authorities, for instance through own investigations."

The company in 2012 launched an internal corruption compliance review amid concerns over the Austrian deal and a British corruption probe into the action of an Airbus unit, GPT Special Project Management Ltd., in Saudi Arabia.

-Write to Robert Wall at robert.wall@wsj.com

(END) Dow Jones Newswires

February 16, 2017 03:30 ET (08:30 GMT)

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