Commentary

October 3, 2012

BAE, EADS blast merger ‘myths and misconceptions’

The chief executives of BAE Systems PLC and EADS NV sought to drum up support Oct. 1 for the merger of their two aeronautics and defense companies in the face of growing criticism to the deal, saying in a joint newspaper article an agreement would help both organizations grow.

The deal would create a global aerospace and defense giant with combined sales of more than $90.3 billion and more than 220,000 employees. However the sector is facing challenges and uncertainties amid cuts to government defense budgets on both sides of the Atlantic.

French media company Lagardere, which owns a 7.5 percent stake in EADS, urged company management Oct. 1 to reconsider the project, “taking better into account the overall interests of the French controlling shareholders in EADS.”

“Despite the industrial and strategic potential it is said to have, has not proven so far that it would be a value creator for EADS,” Lagardere said in a statement. “Lagardere considers that the conditions for joining EADS and BAE together are unsatisfactory at this stage.”

In a joint article written by BAE’s Ian King and EADS’ Tom Enders and published in several newspapers across Europe, the two CEOs said they could not spell out full details on the ongoing negotiations, but that they felt it “important to correct some myths and misconceptions.”

“The first thing to say is that this is a combination borne out of opportunity, not necessity…” the two wrote in the editorial, published in Britain, France and Germany.

“We believe that the time is now. With the necessary political will and support, management determination and proper governance, BAE Systems and EADS can produce a whole that is greater than the sum of its parts.”

EADS is already one of Europe’s biggest companies, parent to aircraft maker Airbus, helicopter maker Eurocopter, satellite builder Astrium and defense electronics contractor Cassidian.

Airbus and EADS have long been rivals to U.S.-based Boeing in civil and defense aviation. The proposed deal is a clear shot at catching up to Boeing’s defense business – and passing it.

The U.S. and European firms have fought ruthlessly in the courts over government subsidies, and competed for years for a huge contract to build new aerial refueling tankers for the U.S. Air Force, a contract Boeing finally won.

EADS is jointly French and German-owned – though incorporated in the Netherlands – with dual headquarters in Munich and Paris as well as the Airbus headquarters in Toulouse, France.

Germany’s Daimler holds a 22.5 percent stake in EADS, the French government owns 15 percent and French media company Lagardere has 7.5 percent.

Enders and King said they were working hard with the respective governments on the merger.

“We are very focused on agreeing to arrangements which protect the strategic and national security interests of the governments with which we work, particularly in France, Germany, the United Kingdom and the United States, given the importance of those markets to the combined group,” they wrote.

“We propose to replace the shareholder arrangements which currently give Daimler, Lagardere and the French state joint control over EADS. That would mean creating a business with governance structures which would enable it to operate in a normal commercial manner.”

 




All of this week's top headlines to your email every Friday.


 
 

 

Headlines December 17, 2014

News: U.S. Air Force tanker platform slated for year-end debut - Boeing is planning for first flight of its 767-2C – upon which the U.S. Air Force’s new KC-46 tanker will be based – by year’s end, six months late. Northrop Grumman wins $657.4 million deal to supply drones to South Korea - Northrop Grumman has won...
 
 

NASA launches new Micro-g NExT for undergraduates

NASA is offering undergraduate students an opportunity to participate in a new microgravity activity called Micro-g Neutral Buoyancy Experiment Design Teams. The deadline for proposals is Jan. 28, 2015. Micro-g NExT challenges students to work in teams to design and build prototypes of spacewalking tools to be used by astronauts for spacewalk training in the...
 
 
launch1

Storm fails to quench liftoff of secret reconnaissance satellite

The fiery launch of an Atlas V (541), among the most powerful of the venerable Atlas family, briefly dispelled the gloom over Californiaís Central Coast on the evening of Dec. 12. A team of personnel from United Launch Allianc...
 

 
Coast Guard photograph

Navy demonstrates unmanned helicopter operations aboard Coast Guard cutter

http://static.dvidshub.net/media/video/1412/DOD_102145893/DOD_102145893-512×288-442k.mp4 Coast Guard photograph An MQ-8B Fire Scout UAS is tested off the Coast Guard Cutter Bertholf near Los Angeles, Dec. 5 2014. The Coast...
 
 
GPS-OCX

GPS III, OCX successfully demonstrate key satellite command, control capabilities

Lockheed Martin and Raytheon successfully completed the fourth of five planned launch and early orbit exercises to demonstrate new automation capabilities, information assurance and launch readiness of the worldís most powerfu...
 
 

Aerojet Rocketdyne successfully demonstrates 3D printed rocket propulsion system for satellites

Aerojet Rocketdyne has successfully completed a hot-fire test of its MPS-120 CubeSat High-Impulse Adaptable Modular Propulsion System. The MPS-120 is the first 3D-printed hydrazine integrated propulsion system and is designed to provide propulsion for CubeSats, enabling missions not previously available to these tiny satellites. The project was funded out of the NASA Office of Chief...
 




0 Comments


Be the first to comment!


Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>