France to Pay Russia US$1.3 billion for Mistral Deal Cancellation

France will pay Russia Euro 1.2 billion (US$1.3 billion) for cancelling the Mistral helicopter carrier deal while allowing the latter to remove all electronic and other systems installed on the vessels.

According to a statement from the office of the French President, Francois Hollade yesterday, an accord has been reached under which Russia would be "fully reimbursed" for the two undelivered warships and France in return would have the "full ownership and free disposal of the two helicopter carriers”.

All Russian equipment installed on the ships will be removed and handed back to Moscow, it added.

Both leaders "agreed on the fact that now this matter is closed", according to the communique.

Paris would pay Moscow 1.2 billion euros (about 1.3 billion U. S. dollars) for refusing to deliver the two warships, initially scheduled for November 2014, due to worsening situation in Ukraine.