JERUSALEM (Reuters) -Israel has agreed with Germany’s Thyssenkrupp Marine Systems to develop and produce three advanced submarines for the Israeli Navy in a deal worth 3 billion euros ($3.4 billion), Israel’s Defense Ministry said on Thursday.
The parties also signed an industrial strategic cooperation agreement that amounts to more than 850 million euros, the ministry said.
The first of the submarines, part a new series that Israel is calling Dakar, will be delivered within nine years, according to the Israeli government.
Israel’s Navy operates five German-built Dolphin-class submarines, with a sixth under order and under construction in Germany. The three Dakar submarines will replace three of the ageing Dolphins.
“I would like to thank the German government for its assistance in advancing the agreement and for its commitment to Israel’s security,” said Defense Minister Benny Gantz.
“I am confident that the new submarines will upgrade the capabilities of the Israeli Navy, and will contribute to Israel’s security superiority in the region.”
The agreement also includes the construction of a training simulator in Israel and the supply of spare parts.
The announcement comes just a few days before Israel’s cabinet is due to discuss forming an investigative panel that will look into the decision-making process, from 2009 to 2016, behind previous purchases of submarines and missile boats from Germany worth hundreds of millions of dollars.
Israeli prosecutors last year charged several Israelis, including a businessman, a former naval officer and a former cabinet minister, with bribery, money laundering and tax invasion in connection with those acquisitions.
Thyssenkrupp has said an internal probe found no evidence of corruption in its handling of the sales, and Israeli authorities have taken no action against the conglomerate.
($1 = 0.8810 euros)
(Reporting by Ari Rabinovitch and Jeffrey HellerEditing by David Goodman and Mark Potter)