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MBDA goes ahead as BAE Systems, EADS and Finmeccanica sign up

BAE Systems, EADS and Finmeccanica have signed the agreements that will finally create European missiles group MBDA and the revised Alenia Marconi Systems (AMS).

MBDA will amalgamate the missiles activities of Matra BAe Dynamics, itself owned by BAE and EADS; EADS Aerospatiale Matra Missiles and Alenia Marconi Systems. The companies' shareholdings are held through intermediate companies, with BAE and EADS each owning 37.5% of MBDA and Finmeccanica owning 25%.

The European weapons house currently has a €13 billion ($10.9 billion) orderbook, thereby becoming the second largest missile company after Raytheon. Matra BAe Dynamics chief executive officer Fabrice Brégier takes the same role with MBDA while Alan Garwood and Mario Di Donato have been appointed chief operating officers.

As a next step, EADS Germany is keen to merge LFK into MBDA. LFK is 70% owned by EADS and 30% by the new missiles group. EADS is keen to first consolidate LFK with the other German weapons company, BGT, but Diehl, the latter's parent, is reluctant. EADS says it will integrate LFK with MBDA in the third quarter of this year if the deal with Diehl cannot be reached.

The €1.3 billion turnover AMS retains the radar, control and command, simulation and training, and air traffic management activities of the previous company and incorporates BAE's Combat and Radar Systems subsidiary. Finmeccanica has invested an undisclosed sum to remain a 50% shareholder in AMS. David Singleton has been appointed CEO with Antonio Bontempi as deputy.

Both of the transactions are subject to national government approvals, which are expected later this year.

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