updated 8/18/2006 12:21:06 PM ET 2006-08-18T16:21:06

Britain said Friday it has agreed in principle on a $19 billion deal to sell 72 Eurofighter aircraft to Saudi Arabia.

The Eurofighters, also known as Typhoons, will replace Saudi Arabia's Tornado fighters, which also were developed by a European consortium.

Saudi Arabia and Britain "signed an understanding document, intended to establish a greater partnership in modernizing the Saudi Arabian armed forces," Britain's Ministry of Defense said. It added that an agreement "has initiated the purchase of Typhoon aircraft."

A statement from the official Saudi Press Agency said the deal involved 72 aircraft and an agreement "to transfer and finally settle technology and invest in the defensive industries in the Kingdom of Saudi Arabia."

In a terse statement to the Stock Exchange, BAE Systems PLC, the prime contractor, said the deal was potentially worth 10 billion pounds, or $19 billion.

In Europe, Eurofighters have been ordered by the United Kingdom, Germany, Spain, Italy and Austria. Campaigns to sell the plane to Greece, Turkey and Japan are under way. Britain's Royal Air Force has taken delivery of at least 28 of the 232 planes it ordered.

The Eurofighter consortium and France's Dassault Aviation SA, maker of the Rafale fighter, last year both lost out to Boeing Co. to sell a dozen F-15SG fighter jets to Singapore.

BAE Systems is also a principle partner in a project to develop the U.S. F-35 Joint Strike Fighter.

The Eurofighter project was begun in the 1980s and the first aircraft flew in 1994.

BAE Systems said before the announcement that it had contracts for at least 638 of the aircraft.

In July, Lockheed Martin Corp. unveiled its F-35 Joint Strike Fighter, dubbed the Lightening II. It is scheduled to begin test flights in October and be deployed for use by the U.S. Marine Corps in 2012.

Lockheed Martin won a $19 billion contract from the U.S. in 2001 to develop the aircraft, which are expected to sell for $45 million to $60 million apiece.

BAE Systems is part of the consortium headed by Lockheed Martin to develop the plane.

Copyright 2006 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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