EADS is registered in the Netherlands, and under Dutch law any alliance that controls more than 30 percent of a company must make a bid for it. That meant that if France and Germany wanted to keep control they might be forced to nationalise the company, an expensive proposition both wanted to avoid.
The old shareholder deal was designed to get around the Dutch rule by placing big stakes in the hands of private firms Lagardere and Daimler. But those companies wanted out, which meant the entire arrangement was in danger of collapsing.
Officials say French President Francois Hollande and Chancellor Angela Merkel quickly agreed the political outlines of a new arrangement: France and Germany would effectively control 12 percent each and Spain 4 percent, leaving a safety margin below the 30 percent ceiling.
On technical points, however, France and Germany started “on a different planet,” according to one person close to the talks. Chief among these differences was composition of the board, on which Berlin initially demanded the right to place appointees.
PIZZA, SUSHI AND LAWYERS SPEAKING DUTCH
The long, final act began late on Friday Nov. 30. For five days, government officials and private negotiators slipped through the back door of French state law offices behind the Champs Elysees, followed by deliveries of pizza or sushi.
Reflecting the wide interests at stake in one of Europe’s most strategic companies, 40 or 50 people negotiated in a large room. Each delegation was assigned a side room to talk tactics.
EADS strategy chief Marwan Lahoud, who had masterminded the failed BAE bid and did much of the creative homework for the new EADS governance deal, asserted the group’s independence by pinning up a “Toulouse” sign outside the EADS retreat. The company’s decision to base itself in France’s aerospace capital was still a sore point with Germany.