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The boss of Italy's biggest defence company, Finmeccanica, and the top executive at its helicopter division, AgustaWestland, were arrested today in a corruption probe.

Finmeccanica chief executive Giuseppe Orsi and AgustaWestland boss Bruno Spagnolini are being quizzed by Italian police over the alleged payment of bribes in the sale of 12 helicopters to India.

The Italian Government has a 30 percent stake in Finmeccanica and Prime Minister Mario Monti underlined the political sensitivity of the case, declaring: "There is a problem with the governance of Finmeccanica at the moment and we will face up to it."

Finmeccanica said it had "solidarity" with Orsi, who has previously denied any wrongdoing at the company.

Analysts warned that the arrests would undermine plans for a major restructuring at Finmeccanica and the shares slumped as much as 14 percent.

Finmeccanica has been dogged by problems. Former chairman Pier Francesco Guarguaglini resigned in 2011 during a previous probe.

Westland, a British helicopter maker which merged with Italy's Agusta in 2000, was at the centre of a political storm in the 1980s when Tory Defence Secretary Michael Heseltine memorably quit Margaret Thatcher's Cabinet.

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