The Russian news agency RIA Novosti said the Russian state arms exporter Rosoboronexport signed an agreement with the Azerbaijani Defense Ministry on the supply of two S-300PMU-2 Favorit (SA-20b Gargoyle b) battalions last year, a top manager of a company producing S-300 components told a leading Russian business daily Vedomosti.
 

The contract is already being implemented and is expected to be fulfilled within a year or two, he said.

A Rosoboronexport official has refused to comment on the report, and Azerbaijani President Ilham Aliyev's spokesman, Azer Kasymov, said he has no information on the issue, the paper said.
 

The deal, worth at least $300 million, is the most expensive single purchase of weapons by a former Soviet state, excluding Russia, Mikhail Barabanov, the editor-in-chief of the English-language Moscow Defense Brief magazine, told Vedomosti. Russia has also sold S-300 missiles to Belarus and Kazakhstan.
 

Russia has also delivered S-300 air defense systems to Algeria and China. In December 2005, Moscow signed a contract on supplying Iran with at least five S-300 systems, but the contract's implementation has so far been delayed.
 

A Russian Defense Ministry officer said the purchase of S-300 missiles would unlikely change the balance in relations between Azerbaijan and neighboring Armenia, which have been at odds for almost two decades over the breakaway region of Nagorny Karabakh. None of the countries has modern fighter jets, cruise or ballistic missiles which S-300 air defense systems are designed to intercept.
 

The officer told the paper Azerbaijan was rather trying to assure its security in case of aggression from Iran.

Azerbaijan has been actively modernizing its military sphere, including the purchase of weapons from Ukraine, Belarus, Israel and South Africa, the head of the Russian Center for Analysis of Strategies and Technologies (CAST), Ruslan Pukhov, told Vedomosti.
 
If Moscow did not supply modern air defense systems to its former Soviet neighbor, then either South Africa or Israel would have done it, he said.