SYDNEY (Dow Jones)–Qantas Airways Ltd. (QAN.AU) discount carrier Jetstar said Thursday it will use International Aero Engines V2500 jet engine to power up to 90 more Airbus aircraft it will operate, in a supply and service deal worth US$3.5 billion.

In a joint statement, Jetstar and IAE said the engine purchase agreement for 50 A320 family planes, with options and purchase rights on up to 40 more aircraft, is worth around US$1.5 billion if fully exercised.

Jetstar has also signed a US$2 billion long-term, aftermarket services agreement with IAE for the new engines and those already installed on 40 aircraft that Jetstar uses on its fleet in Australia and New Zealand or through its Singapore-based affiliate Jetstar Asia.

IAE is a multinational aero engine consortium whose shareholders comprise United Technologies Corp.’s (UTX) Pratt & Whitney division, Rolls-Royce (RR.LN), Japanese Aero Engines Corp. and MTU Aero Engines (MTX.XE).

Rolls-Royce said its share of the order could be worth up to $1.2 billion if all options are exercised.
Source wsj