The CFM International aero-engines joint venture of French group Safran and General Electric has won a multi-billion dollar deal to supply engines for China's future C919 plane, Safran said on Monday.
The contract is worth an initial $5 billion each for Safran and GE but this could rise to some $15 billion over 30 years, the French company's chief executive, Jean-Paul Herteman, said in Beijing.
The first part is worth around 5 billion. Afterwards with the services bit of the deal, such as maintenance and change, it could be worth three times or even more than that, but over a 30-year period, Herteman said.
Our Chinese partners reckon they can make 2,000 planes, Each time they make a plane, we'll be the suppliers, he added.
The deal was announced during a trip to China made by French Prime Minister Francois Fillon and business leaders.
Safran's shares were up 4.1 percent at 13.44 euros in morning trade on the back of the China contract. The stock earlier touched a year high of 13.49 euros and was among the top gainers on the Paris market.
It's great news, said Mandarine Gestion fund manager Fabienne Girard-Tokay, who added she was considering adding Safran shares to her portfolio.
GE shares closed down 1.3 percent at $15.59 on Friday.
The C919 plane is expected to be the largest passenger jet to be produced in China and is slated to start deliveries to customers in 2016. It would compete with similar planes made by EADS's Airbus and Boeing .
The first new generation engine will be made in 2012, certified in 2014 and will enter into service in 2016, said Herteman.