The war of words between the two sides bidding for French state-owned defence-electronics giant Thomson-CSF has intensified, with Aerospatiale president Yves Michot alleging that a decision in favour of Lagardère could cause the break-up of Airbus Industrie and the end of hopes to re-centre the European aerospace industry.

Michot's attack on Lagardère followed moves by Daimler-Benz Aerospace (Dasa), announcing an exclusive $2.3 billion teaming deal with Lagardère's aerospace arm, Matra, offering to contribute its space, missiles and defence-electronics activities. Lagardère also has heavy financial backing of around £300 million ($500 million) from British Aerospace, to take over Thomson-CSF.

Lagardère's "European solution" faces the Alcatel-Dassault Industries bid, which would see Thomson-CSF in a French industry grouping which would include Aerospatiale, once the state-owned manufacturer is merged with Dassault Aviation.

Michot insists that the Lagardère bid would effectively shut the two dominant French civil- and military-aeronautics concerns out of the re-organised European industry. He says that the "alliance against Aerospatiale" could signal the "death of Airbus", resulting from a possible regrouping of Dasaand BAe assets, which could see the UK company taking over Dasa's military operations in return for BAe's Airbus interests. This would leave Aerospatiale in the impossible position of holding a minority stake in the consortium as Airbus attempts to change its status to that of a company.

Dasa chairman Manfred Bischoff dismisses Michot's attack, saying that the German-French-UK alliance would "-present the best strategic conditions for European success against the US threat". He claims that marginalisation of Aerospatiale, with which Dasa has alliances in Eurocopter, Euromissile and Arianespace, "-would enfeeble Dasa".

Earlier in the week, Alcatel chief Serge Tchurk accused Lagardère of planning the break-up of Thomson-CSF "to the profit of Dasa and BAe", while Dassault Aviation boss Serge Dassault says that Matra "-would bring nothing to Thomson in defence electronics. The Alcatel-Dassault offer, says Tchurk, would create a Fr60 billion ($11 billion) enterprise which would be world leader in defence communications, European leader in satellites and radar and countermeasures and second largest in missiles (after Matra-BAe Dynamics).

The privatisation of Thomson-CSF and Aerospatiale could be delayed by May and June elections. Hopes remain, however, that the Thomson-CSF decision will be made at the Paris air show.

Source: Flight International