Subscribe free to our newsletters via your
. 24/7 Space News .




MILPLEX
EADS deal ends state grip, boosts shares and Daimler
by Staff Writers
Paris (AFP) Dec 06, 2012


German auto group Daimler slashed its holdings in aerospace giant EADS on Thursday, but EADS shares still surged higher, hours after France and Germany ended their grip on the boardroom and two months after the collapse of merger talks with BAE Systems.

EADS director for strategy Marwan Lahoud described a share restructuring plan unveiled late on Wednesday and which ends the ability of the French and German governments to effectively control the group, as a "new birth."

The European Aeronautic Defence and Space company (EADS) owns airline maker Airbus which accounts for most of its business, but also builds rocket and missile launchers, satellites, fighter aircraft and helicopters.

Lahoud told the French radio station Europe 1, that from now on "decisions will be taken within the company."

He also said that the chance of a tie-up with the British defence group BAE Systems would not come again but noted that if a similar situation were to arise "I think we would be in a better position to find a solution."

Lahoud nonetheless also said: "We are in the process of reviewing our strategy. At the moment, we do not envisage any kind of acquisition."

The price of EADS shares, which had climbed as prospects for the restructuring increased, shot up by a further 7.97 percent to 29.40 euros on Thursday, above the price at which Daimler sold its shares.

The new level is close to where EADS shares traded before the group revealed on September 12 that it was holding merger talks with BAE Systems, which had caused EADS stock to nose dive.

The ratings agency Moody's said Thursday that it had cut its assessment of EADS debt by one notch from "A2" from "A1" however because the company was less likely to get government backing.

Moody's maintained its stable outlook on EADS debt.

"The rating downgrade reflects lower expectations for potential government support," noted Russell Solomon, Moody's lead analyst for EADS.

Shortly after trading began on Thursday, Daimler said it had halved its holding in EADS, as planned under the restructuring, raising 1.66 billion euros ($2.2 billion).

"Daimler today sold 61.1 million shares in EADS ... The price per share was set at 27.23 euros, which corresponds to the EADS closing price in Paris on Wednesday," Daimler said.

This cut Daimler's stake in EADS to 7.5 percent, and buyers included the German state-owned investment bank KfW, which purchased a stake of 2.76 percent and the Dedalus investor consortium, which acquired 1.9 percent, the statement said.

EADS was created in July 2000 through a merger of German defence group DASA, Aerospatiale-Matra of France, and Spanish group CASA.

Success from failure

--------------------

Under an initial shareholder pact intended to balance national interests, the French state held 15 percent of the group and the French industrial and media group Lagardere 7.5 percent along with the combined voting rights.

Daimler held 15.0 percent, and a consortium of public-private German interests 7.5 percent, all on behalf of the German public interest. A Spanish public holding company holds another 5.45 percent.

Under the new deal, Daimler and Lagardere are to cut back their EADS stakes, leaving German and French state interests each holding 12.0 percent and Spain about 4.0 percent.

The percentage of freely floating EADS shares will jump from 49 percent to more than 70 percent, the group said.

Sources close to French Economy Minister Pierre Moscovici highlighted a clause that would bar any new EADS shareholder from acquiring more than 15 percent.

The ambitious deal with BAE Systems, which would have created a vast group to compete with US rival Boeing, is believed to have failed largely because Germany feared being sidelined, and was worried about the impact on jobs at German aerospace factories.

The British side was concerned that France and Germany would interfere unduly in a merged group, and that this could undermine confidentiality in relationships over US defence contracts.

Under the capital restructuring plan, EADS is to buy and cancel up to 15 percent of its shares.

A portfolio manager at Barclay Bourse, Renaud Murail, explained: "The price is being supported by the outlook for a programme to buy up shares at the beginning of 2013.

"Apart from the fact that EADS has plenty of cash, this programme will compensate for the effect of the arrival on the market of shares held by Daimler and Lagardere which are pulling out."

Brokers at Bank of America - Merrill Lynch upgraded EADS shares to a "buy" recommendation from "sell", commenting that "the influence of the governments has been sharply reduced" and that the company had paid attention to observations from investors and had sought to protect their interests.

Governments are to give up their vetoes on decisions, but Lahoud noted that EADS, given the products it makes, was not an ordinary company. "The states will always have something to say because we are strategic industries regarding their security."

A source close to French Economy Minister Pierre Moscovici said: "The more an operation affects strategic sectors, the more the state's role - both direct and indirect - and their rights will be important."

pmr/wai/arp

EADS - EUROPEAN AERONAUTIC DEFENCE AND SPACE COMPANY

.


Related Links
The Military Industrial Complex at SpaceWar.com
Learn about the Superpowers of the 21st Century at SpaceWar.com






Comment on this article via your Facebook, Yahoo, AOL, Hotmail login.

Share this article via these popular social media networks
del.icio.usdel.icio.us DiggDigg RedditReddit GoogleGoogle








MILPLEX
Talks on EADS shake-up 'proceeding well': Germany
Frankfurt (AFP) Dec 04, 2012
Talks on changes in the shareholder structure of EADS, the parent company of aircraft maker Airbus, are continuing apace and could be completed very soon, the German economy ministry said Tuesday. "The negotiations on a new shareholder structure at EADS are proceeding well. But key details have still to be worked out. The aim is to reach an agreement as soon as possible," a ministry spokesma ... read more


MILPLEX
NASA's GRAIL Creates Most Accurate Moon Gravity Map

Chinese astronauts may grow veg on Moon

WSU researchers use 3-D printer to make parts from moon rock

China's Chang'e-3 to land on moon next year

MILPLEX
NASA to send new rover to Mars in 2020

Safe Driving on Mars

Ancient Mars May Have Captured Enormous Floodwaters

NASA Announces Multi-Year Mars Program With New Rover In 2020

MILPLEX
Kickstarter's creative community takes hold in Britain

Civil Space 2013 Symposium

SciTechTalk: Media fixes for space junkies

NASA Voyager 1 Encounters New Region in Deep Space

MILPLEX
Mr Xi in Space

China plans manned space launch in 2013: state media

China to launch manned spacecraft

Tiangong 1 Parked And Waiting As Shenzhou 10 Mission Prep Continues

MILPLEX
New Crew of ISS to Perform Two Spacewalks

Space Station to reposition for science

Spacewalks on agenda for new space crew

NASA, Roscosmos Assign Veteran Crew to Yearlong Space Station Mission

MILPLEX
SPACEX Awarded Two EELV Class Missions From The USAF

Russia Set to Launch Telecoms Satellite for Gazprom

Sea Launch Delivers the EUTELSAT 70B Spacecraft into Orbit

S. Korea readies new bid to join global space club

MILPLEX
Astronomers discover and 'weigh' infant solar system

Search for Life Suggests Solar Systems More Habitable than Ours

Do missing Jupiters mean massive comet belts?

Brown Dwarfs May Grow Rocky Planets

MILPLEX
Smartphones might soon develop emotional intelligence

Tablet technology takes teaching into 21st century

SES And ESA To Collaborate On Electra To Develop First All-Electric Small/Medium Sized Satellite Platform In Europe

Apple's CEO to bring production back to US




The content herein, unless otherwise known to be public domain, are Copyright 1995-2014 - Space Media Network. AFP, UPI and IANS news wire stories are copyright Agence France-Presse, United Press International and Indo-Asia News Service. ESA Portal Reports are copyright European Space Agency. All NASA sourced material is public domain. Additional copyrights may apply in whole or part to other bona fide parties. Advertising does not imply endorsement,agreement or approval of any opinions, statements or information provided by Space Media Network on any Web page published or hosted by Space Media Network. Privacy Statement