Article Posted on : - Feb 18, 2010

EADS Pavilion at Defexpo 2010. Brahmand photo

PARIS (AFP): Aerospace giant EADS said that a new finance offer from partner governments to try to rescue the troubled A400M military transport plane marked an important step but no deal had been reached.

The offer "is definitely an important step towards convergence, but it is not a contract draft," the company said in a statement on Wednesday, adding that it would seek "clarification" on several points.

EADS said it was studying an offer from partner governments that could rescue the A400M project, which is three years behind schedule and a reported USD 15 billion over budget.

It did not give details but the Financial Times Deutschland reported that the seven countries had offered two billion euros in additional financing and 1.5 billion euros in credit guarantees.

The European Aeronautic Defence and Space Company (EADS) has threatened to pull the plug on the project unless the seven NATO countries that have ordered 180 of the aircraft for 20 billion euros stump up more cash.

Germany and France are the project's biggest customers, with 60 and 50 orders respectively.

Negotiations are focussed on the financing of 5.2 billion euros in cost overruns.