FILE PHOTO: The Boeing logo is pictured at the Latin American Business Aviation Conference & Exhibition fair (LABACE) at Congonhas Airport in Sao Paulo, Brazil August 14, 2018. REUTERS/Paulo Whitaker/File Photo

LONDON (Reuters) - British engineer Cobham will take an additional exceptional charge of 160 million pounds ($206 million) to settle a dispute with Boeing over its delayed KC-46 aerial refuelling programme, it said on Tuesday.

Cobham, Britain’s third-biggest defence and aerospace group behind Rolls-Royce and BAE Systems, said the charge comprised 86 million pounds relating to settlement of the dispute and 74 million pounds of additional costs to complete the retained KC-46 contract.

Known for its air-to-air refuelling technology, Cobham had been in recovery mode since a string of profit warnings forced it into a rights issue in 2017.

In 2018 that recovery was disrupted by a 40 million pound charge over problems with the Boeing refueling programme, prompting a 10 percent drop in its share price on the day.

Boeing, the world’s largest planemaker, had withheld payments over delays.

Cobham said on Tuesday the two sides had now settled the dispute. The Wing Aerial Refuelling Pod programme is now expected to complete around the middle of 2020, with associated flight tests expected to start in the first half of 2019.

The 74 million pounds reflects the costs of the revised schedule and the risks of getting it completed.