France Russia Mistral Deal 2015: Egypt's Helicopters Won't Be Delivered Until Russian Equipment Dismantled, Rostec Says

Russian aircraft makers will not build helicopters for Egypt's recently purchased Mistral aircraft carriers until Russia's equipment is dismantled from the ships, the head of Rostec, a Russian state-owned corporation that builds military equipment, said Monday. The pair of Mistrals sold to Egypt by France were initially intended for Russia and needed to have their equipment disassembled prior to any deals, Russian state-owned news agency Tass reported.

"Egypt has not yet made the request because our equipment has not been dismantled yet from the Mistrals," Sergey Chemezov, head of Rostec, said at a Dubai air show Monday. "As soon as the work is over, we’ll be able to offer both our equipment and our helicopters."

The Mistral warships were built for Russia by a French manufacturer following a deal made by the two governments in 2011. The sale of the Mistrals would have been the first arms deal between Russia and a Western power in history.

Following Russia’s annexation of the Crimean peninsula and reported armed support for pro-Russian separatists in Ukraine, French President Francois Hollande canceled the deal in 2014. France struggled to find a buyer for over a year until Egypt bought both of the ships in a $1 billion deal in September. France refunded Russia around $1 billion for cancellation of the deal.

Russia offered to outfit the Mistrals with helicopters and electronic equipment shortly after Egypt announced the purchase. "Russia will be, if you want, a subcontractor who will supply the missing equipment without which the Mistral warships are just a tin can -- and of course, all the helicopters,” Kremlin Chief of Staff Sergei Ivanov said in October, as reported by Russian news agency Sputnik International. The sale of helicopters and electronics to Egypt could amount to $1 billion in revenue for Russia, he said.