Korea Aerospace Industries has selected French-German joint venture Eurocopter for its new multi-purpose helicopter program.

The Korean aircraft manufacturer on Monday said it signed a contract to that end with the European firm in Sacheon, South Gyeongsang Province.

Korea Aerospace heads the Korean Helicopter Program, which will develop next-generation transport helicopters by 2012 to replace outdated choppers such as 500-MD models.

Eurocopter said it is eyeing other foreign markets after winning the right to produce choppers through the contract with South Korea.

The nation will spend five-point-four trillion won on the project over the next six years.