South Korea’s Hyundai Rotem is to sign a $260m contract with the Islamic Republic of Iran Railways (RAI) in July for the supply of 150 diesel multiple-unit (DMU) train cars.

While the memorandum of understanding (MoU) for the project has been signed and reported previously, the value of the contract was not previously disclosed.

“Hyundai Rotem signed a similar deal in 2004 to supply 150 train cars to Iran but it [contract] had to be put on hold after 2010 due to the sanctions,” said a South Korean news agency, citing a press statement from Hyundai Rotem. Hyundai Rotem had apparently supplied 68 cars prior to the suspension of the previous contract, for which the company said it never received any payment.

Following the lifting of most nuclear-related international sanctions earlier this year, Hyundai is understood to have held negotiations to settle the unpaid bill worth around 87.6bn won ($76.1m) and supply the remainder of the promised train cars to Tehran. 

South Korea President Park Geun-hye visited the Islamic Republic on 1-3 May, a first by a South Korean president since 1962.

Park’s delegation attended the signing ceremony for several MoUs during her visit, including the one between Hyundai Rotem and the RAI.

The MoUs within Iran’s transport sector are understood to include one between Incheon International airport and Imam Khomeini International airports, and another for the construction of the Isfahan-Ahvaz railway line.