News Column

EADS Denies BAE Merger Talks Close to Collapse

Oct. 5, 2012

European aerospace and defence company EADS rejected Friday a report that its planned merger with BAE Systems of Britain was close to collapse because of disagreements between the three governments involved.

"We have been informed by the governments about the progress of the talks," said an EADS spokesman in Munich. "At no time have we been told that the deal has collapsed."

The German magazine Der Spiegel had earlier reported that talks between the governments of France, Germany and Britain had ended without a result.

Questioned about the reports of a stalemate French President Francois Hollande said France had made known its conditions on "share in the capital, localization of the headquarters and protection of our defence industry."

It was now "up to the companies to continue their talks or negotiations", he said on the sidelines of a summit in Malta, without detailing France's exact demands.

Spiegel had quoted "government sources" as saying that London and Paris remained at odds, with the British insisting that no government hold in excess of 10 per cent of the combined group.

France's AFP news agency reported that Germany wanted to acquire 9 per cent of the capital, equivalent to France. The report said Britain agreed to such a share, on condition that France commit not to increase its stake by acquiring the share of French media group Lagardere. AFP said France had refused such a commitment in writing.

The EADS spokesman said EADS and BAE were still aiming to meet an October 10 deadline under British law to issue an announcement on the progress of the merger negotiations.

EADS owns Airbus, the maker of airliners, as well as companies that supply a variety of military aircraft and weapons. BAE is defence supplier with no government shareholder. A merger would create a combined group comparable to Boeing of the United States.

Source: Copyright 2012 dpa Deutsche Presse-Agentur GmbH

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