Shares of BAE Systems shot by eight percent on Friday after Serious Fraud Office dropped a two-year case probing past defence deals with Saudi Arabia. The investigation of multi-billion-pound defence deal was immediately stalled after the U.K. government warned that the investigation could undermine national security and its foreign policy objective in Middle East. However, the opposition politicians have fiercely criticized the recent decision of SFO saying cash had been put before principle.
The SFO had been probing into BAE System’s Al Yamamah arms deal with Saudi Arabia that dates back to 1980s. The Attorney General, Lord Goldsmith, has told the parliament that continuation of the investigation may have negative consequences for the U.K. public interest. He told the parliament that it6 can have serious implications on the national security and U.K. highest foreign policy objectives in Middle East.
The decision has been taken in the wake of warning given by Saudi Arabia to set a deadline to drop the case or lose a contract for 72 Eurofighter Typhoon combat Jets involving $19.8 billion. On the other hand, BAE has welcomed the SFO’s decision to halt the investigation on the accusation that they have used a slush fund to keep to entertain Saudi officials. BAE chief executive was quoted last month that the talks for sale of Typhoons have been stalled by Saudi Arabia following the widening investigations.
