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India 'to cancel' 12-helicopter contract with AgustaWestland

Finmeccanica stock slips on report over scandal-hit deal

19 November, 14:28
India 'to cancel' 12-helicopter contract with AgustaWestland (ANSA) - Milan, November 19 - India is set to cancel a contract with AgustaWestland for 12 helicopters, Indian press reported on Tuesday citing defence ministry sources.

Stock in AgustaWestland's parent company Finmeccanica fell 1.73% to 5.40 euros on the reports.

Finmeccanica's largest shareholder is the Italian government, which owns 30% of the defence and transport conglomerate.

Indian auditors in August criticized their government over the multi-million-euro contract to buy helicopters equipped for VIP use in a long-running saga concerning the troubled deal.

In a report to parliament, the comptroller and auditor general of India slammed the procurement process, saying regulations had been violated, and condemned the contract's ''unreasonably high'' costs.

Both Italy and India have opened separate judicial investigations into allegations of bribery in the deal.

Italian prosecutors have requested a fast-track trial on corruption charges for former Finmeccanica chief executive Giuseppe Orsi along with Bruno Spagnolini, chief executive of the AgustaWestland helicopter unit.

The government of India froze payments on the contract in February and threatened legal action if any wrongdoing was uncovered.