European missile-maker MBDA is to develop and produce a light anti-ship missile for Britain and France under a $826 million contract.

The award for the ANL/FASGW(H) missile was issued earlier this week by Britain's Ministry of Defense on behalf of the two countries, marking the consolidation of the countries' missile industries.

"This program initiates a new era of cooperation that will allow significant efficiencies on future programs," said Antoine Bouvier, chief executive officer MBDA. "Instead of combining their efforts program by program, as has been the case up to now, France and the UK will coordinate their development and acquisition approach to eliminate duplication in the missile sector.

"A decisive step has been made towards the reinforcement and sustainability of the missile industry sector in Europe. This development also ensures a long-term commitment to our armed forces customers with regard to their security of supply based on mutual access to sovereign technologies."

The missiles will equip the Royal Navy's AW159 Lynx Wildcat helicopters and the French Navy's helicopters. They will weigh about 220 pounds and will be used from stand-off range to destroy small, fast inshore attack vessels and other craft up to corvette size.

MBDA said the missile will also have a surface attack capability for coastal targets ashore.

Britain and France have increasingly cooperated with each other in the defense sector and say this contract is the result of defense ministerial summits over the past several years.

France's Directorate General of Armaments and its British counterpart will management development of the missile through a joint program office in Britain.

MBDA is owned by Airbus Group of France, BAE Systems of Britain, and Italy's Finmeccanica.