You're reading: France scuttles Mistral warship deal with Russia

The French government has decided not to deliver to Russia two high-tech warships built under a billion-euro contract with Moscow, the Elysée Palace announced on the evening of Aug. 5.

France will now have “full ownership and free disposal” of the Mistral-class warships after French President Francois Hollande and his Russian counterpart Vladimir Putin reached agreement in a phone conversation to scrap the deal on the sophisticated helicopter carrier assault vessels, French newspaper Le Monde reported.

The two leaders “had discussions this afternoon to confirm that France and Russia have reached an agreement to terminate the contract signed in 2011, which provided for the delivery of two projection and command ships (BPC) (of the) Mistral type, “reads the statement from the Elysee reported by Le Monde.

Russia will be “fully reimbursed the sums advanced under the contract,” the Elysee statement reads. Moscow has already provided more than €800 million on a contract that would have totaled nearly €1.2 billion, the French newspaper said.

France suspended the delivery of the first of the two ships at the end of 2014 for an indefinite period, following Russia’sinvasion and annexation of the Ukrainian territory of Crimea and subsequent destabilization of eastern Ukraine.

Moscow denies its involvement in the conflict in eastern Ukraine, but a large and growing body of evidence indicates thatRussian armed forces have directly participated in several battles in the Donbas, most recently when the government-held town of Debaltseve was attacked and captured by separatist forces in February.

A number of Russian soldiers have also been captured on Ukrainian soil in recent weeks.