Aerospace: BAE in talks to sell Airbus stake, expand in US
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Manufacturing News, Source : The Manufacturer US
Published : 11 Apr 2006 21:23
BAE systems, the UK-based defense manufacturer, makes no secret of its plans to expand in the US, and is in talks to sell its 20% stake in France-based Airbus to its majority owner.
Airbus is in turn owned 80% by European Aeronautic Defense & Space or EADS, and the sale would give it 100% ownership of Airbus. Trouble is, according to the Wall Street Journal, Airbus’ ongoing war has left EADS cash-strapped, and the buyout would cost it between $5 and $6 billion. EADS has the right of first refusal to BAE’s stake in Airbus, and likely will feel compelled to come up with the cash. BAE is determined to cross the pond, and Chief Executive Mike Turner said in a statement that the sale would “allow us to concentrate on our core trans-Atlantic defense and aerospace strategy."
Airbus topped Boeing in 2005 with net orders for 1,055 planes, versus 1,002 for Boeing. Boeing, on the other hand, sold more high-value wide-body planes, capturing 55 percent of the value of new orders.
Competitor to Boeing or no, the US would benefit from aerospace/defense jobs, and an expanding BAE would spread a slightly weary Airbus’s defenses a bit thinner.
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