Austria to sue Airbus over Eurofighter deal

The first Austrian military jet fighter "Eurofighter Typhoon" lands on the military airport in the small Styrian village of Zeltweg, Austria, in this July 12, 2007 file photo. (Reuters)
Updated 16 February 2017
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Austria to sue Airbus over Eurofighter deal

VIENNA: Austria said Thursday that it will sue European aerospace giant Airbus over a $2-billion sale of Eurofighter jets that has long been plagued by allegations of kickbacks.
A government probe concluded that the Airbus and Eurofigher consortium had “deliberately misled the Austrian Republic on the real price, delivery capabilities and its equipment” of the deal signed in 2003.
“Austria would have never decided to buy the Eurofighter jets in 2003 without the fraudulent deception by Airbus and Eurofighter,” Defense Minister Hans Peter Doskozil said.
EU member Austria is seeking damages of up to €1.1 billion ($1.16 million) for its largest-ever defense deal, worth around €2 billion.
According to the “Task Force Eurojet” report presented in Vienna, Eurofighter knew that it would not be able to meet the delivery deadline of the 15 planes.
The five-year-investigation also found that Austria had been overcharged for costs that allegedly included backhanders.
“The two companies never informed Austria that the 2-billion-euro deal would include 183.4 million euros of legal but also criminal fees,” Doskozil told reporters.
Ahead of the report’s release, Airbus said in a statement sent to AFP that it was not aware of the Austrian findings and had received “no details” regarding the lawsuit.
However it said that Airbus has been “cooperating with the authorities in recent years, for example through its own enquiries.”
In late January, Airbus had already agreed to pay tens of millions of euros in additional taxes over an allegedly shady 90-million-euro payment linked to the Austrian Eurofighter contract.
Austrian and German authorities launched the current corruption probe into Airbus, then called EADS, to investigate whether officials had been paid millions of euros through advisory firms to secure the contract.
Prosecutors in Munich are set to publish their preliminary findings later this year.
The Eurofighter deal was first announced in 2000 by Austria’s then conservative-run government despite fierce opposition from its far-right coalition partner and the Social Democrats.
The government had initially ordered 24 jets but later dropped the number to 18 and then to 15 because of budgetary constraints.
The purchase of the military fighter jets also stirred public unease in non-NATO neutral Austria.
Shortly after the contract was signed, allegations started to circulate that politicians and others involved in the deal were receiving kickbacks.
A probe was set up in 2007 to look into possible bribes, but came to no firm conclusion.
The Eurofighter Typhoon is a major prestige product for the European defense industry. The first prototypes were made in 1989.
The four founding nations in the consortium — Germany, Spain, Britain and Italy — all use the aircraft in their own air forces.
Austria saw the first sale outside of the four consortium members, and since July 2007 the 15 Austrian jets have clocked up more than 5,000 flying hours, according to the consortium.
In 2006 Saudi Arabia agreed to purchase 72 Eurofighter Typhoons. Other contracts have been signed with Oman and Kuwait.
As well as Airbus Defense and Space, representing Germany and Spain, the consortium includes British group BAE Systems and Italian firm Leonardo.
Eurofighters were used in combat missions in Libya in 2011.


Careem looks to raise up to $200 million in China

Updated 20 November 2018
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Careem looks to raise up to $200 million in China

  • Investment bank China International Capital Corporation (CICC) is advising Dubai-based Careem, but it was not immediately clear when or if a deal would be finalized
  • Careem said in October it had secured $200 million in a new funding round from existing investors

HONG KONG: Careem, Uber’s main Middle East rival, is looking at raising between $100 million and $200 million from Chinese investors, a source with direct knowledge of the matter told Reuters.
Investment bank China International Capital Corporation (CICC) is advising Dubai-based Careem, but it was not immediately clear when or if a deal would be finalized, the source said, adding there was a lack of familiarity and interest among Chinese investors in Middle Eastern start-ups.
Beijing-based CICC and Careem both declined to comment.
Reuters reported on Monday that CICC and New York-based investment bank Jefferies were both advising Careem on potential investment options and capital raising, including a possible Middle East M&A deal with Uber.
Careem, which counts German car maker Daimler and China’s largest ride-hailing company DiDi Chuxing among its other backers, competes head-to-head with Uber in most of the major cities in the Middle East.
Careem said in October it had secured $200 million in a new funding round from existing investors, and that it expected to raise more to finance expansion plans.
That investment, combined with previous fund raising and company growth into new markets and segments, gave Careem an estimated valuation of more than $2 billion.
Reuters reported in March that Careem was in early talks to raise as much as $500 million.