The French government says it is to sell two Mistral warships, which were originally intended for Russia, to Egypt.
According to a statement released by the French presidency on Wednesday, President Francois Hollande and his Egyptian counterpart, Abdel Fattah el-Sisi, "have agreed on the principle and terms and conditions of Egypt's acquisition of the two Mistral-class vessels."
The assault ships are capable of carrying 16 helicopter gunships, 700 troops and as many as 50 armored vehicles and were ordered by Russia in 2011.
However, the 1.2-billion-euro (USD 1.3-billion) deal between Paris and Moscow fell apart over the crisis in Ukraine as France along with its western allies accused Russia of having a hand in the eastern Ukraine conflict, an accusation that Kremlin categorically rejects.
France finally agreed in August to return some 950 million euros (USD 1 billion) already paid by Russia following eight months of intense negotiations.
It is not clear how much Egypt is due to pay for the warships, but French government spokesman, Stephane Le Foll, said no money would be lost in the new deal.
The Mistral warships are the second big military deal between Paris and Cairo in 2015 as the North African country has already bought 24 advanced fighter jets from France for 5.2 billion euros (USD 5.9 billion).
Amnesty International, however, condemned the decision to sell the jets to Egypt over its "alarming" human rights abuses.
The former army chief and current president, Sisi, has been engaged in a massive crackdown on protesters over the past two years, killing hundreds of political activists, mostly affiliated to the Muslim Brotherhood. Many others have died inside detention facilities while the judiciary has sentenced hundreds more to death.