BAE in talks to sell its stake in Airbus
Published 9:00 pm Thursday, April 6, 2006
The big news in aerospace today involves Airbus — according to reports from Europe, BAE Systems, which owns 20 percent of the enterprise, is in talks to sell its stake to majority shareholder EADS.
It’s a significant historical move. British Aerospace, the company that became BAE, was the fourth European aerospace company to join the Airbus consortium. But in recent years, BAE had lessened its involvement in the commercial side of Airbus to focus on defense business.
Key Quote, from Financial Times: http://news.moneycentral.msn.com/provider/providerarticle.asp?feed=FT&Date=20060407&ID=5630632 “Mike Turner, BAE Systems chief executive, said Airbus had been ‘an excellent investment,’ but he added: ‘We believe that now is the right time for us to divest our Airbus shareholding to allow us to concentrate on our core transatlantic defence and aerospace strategy.’”
BAE is the third major stakeholder to announce plans to sell off its shares this week, Bloomberg News reported. http://www.bloomberg.com/apps/news?pid=10000102&sid=aFmwysmWcMPw&refer=uk Speculation immediately cropped up over why BAE may want out of Airbus now.
Key Quote: “‘They have had the right to sell the stake for several years and haven’t done it yet, so that could mean they have a biggish U.S. acquisition lined up,’ Andy Lynch, a fund manager in London at Schroder Investment Management, said.”
The Times in London http://business.timesonline.co.uk/article/0,,13129-2123841,00.html reported on that.
Key Quote: “Analysts last night predicted that the UK defence company would look to seize a few US companies … Companies such as Armor Holdings, an armour manufacturer, and DRS Technologies, a defence electronics group, could be targets, Merrill Lynch analysts believe.”
The sale won’t affect Airbus employment in the United Kingdom, The Daily Mail reported. http://www.dailymail.co.uk/pages/live/articles/news/news.html?in_article_id=382273&in_page_id=1770
Key Quote: “Trade and Industry Secretary Alan Johnson sought to reassure the UK’s 13,000 Airbus workers in Broughton, North Wales and Filton, Bristol, that the Government remained committed to the project.”
