Aero Vodochody Aerospace has agreed to the essential terms of a contract covering the sale of 12 L-159 light combat aircraft to the Iraqi Ministry of Defence (MoD).
According to agreed conditions, the company will supply two two-seater and ten single-seater L-159s to Iraqi Air Force (IqAF), along with a complete aircraft package, including ground equipment, spare parts, training and supply of arms and ammunition.
The company will also repurchase 11 retired and four active L-159 aircraft from the Czech Republic Ministry of Defence.
Aero Vodochody Aerospace president Ladislav Simek said: "Negotiations with representatives of the Ministry of Defence were very intense, challenging and professional.
"We had to agree to a range of concessions, especially when determining the final price.
"The result, however, can be considered a breakthrough. The Czech aviation industry has a chance to win an important contract, which opens the door for other projects in the field of military aviation."
The contract is subject to approval by the Czech Government, and is likely to be submitted to the government in the next few weeks.
If all conditions are addressed, the contract is likely to be finalised in the last quarter of 2014.
The actual conclusion and implementation of the contract on the Czech side needs a credit insurance contract and a bank guarantee, which is required for opening a letter of credit.
Commenting on the contract, Simek said: "The implementation of the contract should involve 37 Czech companies, and generate sales of about CZK600m.
"This corresponds to about 250 jobs over two years. Aero Vodochody will require about 80-100 new employees, which is not a negligible contribution to employment in the region."
A successor of Aero L-39 Albatros, the L159 advanced light combat aircraft is designed to perform close air support, tactical reconnaissance, air defence, counter insurgency, border patrol and lead-in fighter and weapons training missions.
Image Link: A Czech Air Force’s L-159 ALCA aircraft in flight. Photo: courtesy of Ministerstvo obrany Ceské republiky.