October 02, 2012
Credit: Credit: BAE Systems
EADS and BAE Systems battled to save their $45 billion merger plan from the crossfire of competing interests on Monday as governments and shareholders staked out positions in talks aimed at creating the world’s biggest arms firm.
Arnaud Lagardere, the leading French industrial shareholder of Airbus parent EADS, threw an unexpected spanner into the plans by demanding the financial terms be reviewed, setting off a frenzy of briefings and counter-briefings from all sides.
“Despite the industrial and strategic potential attributed to it, this plan has not yet demonstrated that it was creating value for EADS,” Lagardere’s media firm said.
The comments increased pressure on EADS Chief Executive Tom Enders and BAE Systems’ counterpart Ian King, hours after they urged investors to back a deal complicated by demands from European governments and volatile share prices.
In an article published by three European newspapers, Enders and King dismissed what they termed “myths and misconceptions” about the plan, which has split the industry and politicians ahead of an Oct. 10 deadline for terms to be presented.
EADS Chief Executive Tom Enders embarked on shuttle diplomacy, meeting Lagardere in Paris and senior UK officials in London, where he had a previously scheduled speaking engagement.
Speaking to a packed audience of engineers swelled by media covering the deal, Enders acknowledged Lagardere’s concerns.
“Mr Lagardere put out a press release that I wouldn’t say was unfriendly, but was just stating the obvious, that he wants to see a beneficial return from this,” Enders said.
He said the next 10 days would be crucial for the deal.