Under the terms of the €1.2bn deal, outlined in a brief note on Twitter, Russia is reimbursed all money paid up front, it has its equipment already installed on the ships returned and France gets to dispose of the hulls in whatever manner it sees fit.
#Mistral : la France et la Russie sont parvenues à un accord pour mettre un terme au contrat signé en 2011 pic.twitter.com/yNljf0Qm5H
— Élysée (@Elysee) August 5, 2015
The deal came after an "amicable" conversation between Presidents Hollande and Putin, the communication said.
The Baltic States had long objected to the deal on the grounds that the Mistral ships would greatly enhance Russia's ability to launch attacks in the region which - given Russia's current aggression in Ukraine and belligerent attitude towards the Baltics was of great concern.
Though good news for the Baltic states, the decision is likely to prove controversial in France where jobs are likely to be lost and the cost of the deal will have to be covered.
