Safran To Pay Dassault $280M in Silvercrest Settlement

 - September 10, 2018, 12:05 PM
Safran will pay Dassault Aviation $280 million to settle a dispute over problems with the former's Silvercrest engine. After numerous problems with the turbofan that caused years of delays, Dassault canceled the Falcon 5X program in December and scrapped its contract with Safran. In February, Dassault launched a new super-midsize business jet, the 6X, powered by a pair of Pratt & Whitney Canada PW812D engines. (Photo: Safran)

Safran and Dassault Aviation have reached an amicable settlement regarding the Silvercrest engine dispute, Safran disclosed late last week in its first-half financial results. Dassault canceled the Falcon 5X program on December 13 and subsequently scrapped its contract with Safran over the troubled Silvercrest turbofan that was to power the new super-midsize twinjet. In February, Dassault launched a new super-midsize business jet, the 6X, powered by a pair of Pratt & Whitney Canada PW812D engines.

The indemnity to be paid to Dassault related to the termination of the Silvercrest engine for the Falcon 5X amounts to $280 million, to be paid over the next three years. Other conditions of the program that were applicable to the Silvercrest contract remain unaffected, in particular the cash contribution already paid by Safran.

"This agreement will have a positive impact on Dassault Aviation’s 2018 results," Dassault told AIN, declining to comment further. Safran confirmed that this agreement will not change its profitability and cash flow generation outlook.

According to Safran, several of its subsidiaries are partners on the new Falcon 6X and they have already signed contracts with Dassault. In fact, Zodiac, which Safran acquired in March, would be its most-involved subsidiary in the 6X program, followed by Safran Power Units for the APU. First delivery of the 6X is scheduled for 2022.