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Aviation History
2000
2000 - 1251.PDF
Finmeccanica opts for EADS link CAROL REED/ROME ANDY NATIVI/GENOA AFTER A last-minute re-evaluation prompted by an improved offer from BAE Systems, Finmeccanica has chosen Euro pean Aeronautic, Defense and Space (EADS) as a joint venture partner for its Alenia Aeronautica subsidiary. The agreement, sealed in Rome on 14 April, involves a 50:50 mili tary and civil aircraft venture, to be established by the end of the year, and meet Finmeccanica's require ment for an equal status partner ship. The venture will combine Alenia's civil aircraft and fighter, trainer and military transport busi nesses with the military activites of EADS partners CASA and DaimlerChrysler Aerospace and Aerospatiale Matra's ATR work with Alenia. The new entity will contest European military aircraft leader ship with BAE, controlling 62.5% of Eurofighter (at the core of the EADS deal, but excluded from BAE's initial bid) and 70% of the Airbus Military Company A400M tactical transport. EADS says it also plans "to fur ther link Finmeccanica with the Airbus system", having invited it to join the planned Airbus Integrated Company as a 5% shareholder, an option that can be exercised within three years. It will also "have a participation of up to 10%" in the A3XX pro gramme, the new partners say. Dubbed "JV Co", the entity will have combined revenues of €2.5 billion ($2.4 billion), employee some 17,000 people and, in organ isational terms, will be a subsidiary of the aeronautics division of EADS. It will be managed via oper ating bodies established in Italy, Germany and Spain. Political considerations were also key to the decision, with state holding company IRI, the Italian treasury and the Prime Minister's Office all favouring the "more European" EADS option. Alenia was also wary of being engulfed by a BAE tie-up, while the UK company may have been unable to match EADS' offer on Airbus activities. The EADS deal further diversi fies Finmeccanica's web of aero space alliances; it is already twinned with GKN Westland (helicopters), "New Matra BAe Dynamics" (missiles), Astrium (space) and BAE via Alenia Marconi Systems (military elec tronics). The state-owned group's armaments/armour, non-AMS electronics and underwater sys tems businesses still seek partners. The EADS-Alenia deal appears to push BAE even further in the direction ofa transatlantic partner ship, with media speculation on a possible full merger with Boeing rife just days before the Fin- EADS now controls the Eurofighter following the link with Alenia meccanica announcement. Both companies played down the merg er rumours. BAE's Alenia bid centred on a trainer and transport aircraft ven ture, although the offer was later extended to include combat air craft. It says it was "disappointed" by the rejection of its bid, which also included Finmeccanica's non- aerospace activities. EADS co-chairman designate, Jean-Luc Lagardere, says the Alenia battle was "a singles match", and had to have a winner, but that the wider competition will be "a doubles tournament", in which EADS will require a partner, and BAE might therefore feature. • Dassault Aviation, which offers fighter aircraft in competition with EADS (its part-owner via Aerospatiale's 45.7% holding), says it was neither "invited" to join nor "consulted" on the JV Co entity. Serge Dassault, a 49.9% share holder is reportedly keen to swap sides and join BAE. Chief executive Charles Edelsteene says Dassault remains in "strategic co-ordination" with EADS. "There is no change in our status," he says. EADS co-chair Manfred Bishoff, says France would not allow a BAE link-up. • Additional reporting Julian Moxon, Paris EADS merger set for European Union approval by middle of May ALAN GEORGE/BRUSSELS THE EUROPEAN Union's (EU) competition authorities are set to give approval to the merger of DaimlerChrysler Aerospace (Dasa), Aerospatiale Matra and CASA in mid-May, sub ject to conditions that could see them shed certain space activities. Approval would clear the way for the creation of European Aeronautic, Defense and Space (EADS), and its planned mid-year flotation. The newly agreed EADS-Finmeccanica joint venture also requires approval, but will be dealt with as a separate case. • Sources say the competition directorate-general (DG) has iden tified concerns over composite materials used in satellite manufac ture, particularly in the areas of antenna reflectors and central tubes, the main structural arms of satellites around which payloads are attached. The EADS partners last week formally submitted proposals to allay EC concerns by reorganising their space operations. Manfred Bischoff, EADS co-chair elect, says they have offered to either dispose of the space activities, form a joint venture or agree a technology licensing deal. If the proposals are well-received, as seems likely, the merger is likely to be approved under a six-week fast-track proce dure on 11 May, when the period expires. The EADS companies had anticipated concern over the merg er's impact on the European missile seeker-head sector, and made con tingency plans to satisfy Brussels. Space has now emerged as the only area of serious regulatory concern. The EC's competition DG was formally notified of the EADS merger in late February, with the companies hoping for approval within one month after a so-called first phase enquiry. By late March, however, the regulators had not completed their investigations and extended the initial enquiry by a month, to 27 April. The six-week fast-track period began with this extra month of the enquiry. • FLIGHT INTERNATIONAL 18 - 24 April 2000 7
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