September 27, 2012
Germany and France may seek to secure a 27 percent combined share holding in a company formed from a merger of EADS and BAE Systems, but Britain is opposed, the Financial Times Deutschland said.
The stake would create a shareholder counterweight with the power to block decisions by the management of the new company, the FTD said, citing sources familiar with the matter, in an article due to appear in its Friday edition.
The move could also prove a deal breaker since EADS boss Tom Enders has repeatedly said he wants to reduce state influence in a combined company.
The FTD said the idea enjoys French support, but France has so far proved unwilling to be pressured into trading concessions for the sake of a common position with Germany, given the mismatch of share holdings.
It was an open question whether Germany would approve a proposal, the paper said, quoting industry sources.
The two countries should also each get a seat on the board of directors of the merged company, the German paper said.
France owns 15 percent of EADS and wants to retain its right to influence group strategy. Germany is not a direct shareholder, but sees the transaction as a chance to tighten its grip on a stake currently held by Daimler AG and a group of banks.
On Saturday, France and Germany agreed at a summit to “consult” on the merger talks, but French President Francois Hollande avoided pledging to create a common position between the two countries, despite earlier German hopes of a joint initiative.
The planned $45 billion merger aims to create the world’s biggest defence and aerospace company. It would dilute the influence of the French, German and Spanish governments, prompting negotiations over their future roles.