Tehran, May 7 (IANS): Iran has cancelled an agreement with French industrial group Bouygues to develop the Imam Khomeini International Airport (IKIA) here, media reports said.

Bouygues signed a memorandum of understanding (MoU) in January 2016, worth $2.8 billion, to build and operate a terminal at IKIA. Bouygues' partner for the development plan already pulled out of the project in February, Press TV reported.

The spokesman for Bouygues, Mathieu Carre, also confirmed the cancelation of the deal, saying that MoU "is now void but there are still ongoing discussions with Iranian authorities", Xinhua news agency reported.

Earlier, a French daily reported that the project was hindered since Bouygues could not receive financial support from the international banks, which are still fearful of US punitive measures against Tehran.

According to Press TV, another French construction group Vinci signed preliminary deals last January to develop Iran's Mashhad and Isfahan airports.