VIPsight - November 2012

COMPANIES

Entry of the federal government to EADS more concrete

Two weeks after the failed merger with BAE Systems, the planned entry of the German government to the European Aeronautic Defence and Space Company (EADS) is back on the agenda. On 25 October, the budget committee of the Bundestag cleared the way for more state involvement.  According to participants, it freed a previously blocked sum of 1.6 billion euros to hedge the risk of the transaction, in which the federal government is to acquire up to twelve percent of EADS shares through the Bank for Reconstruction (KfW). The shares would cost the federal government about three billion euros. As is evident from a report by the Federal Ministry of Economics to the budget committee of the Bundestag, Berlin wants to maintain the balance of power between France and Germany only if Daimler successively withdraws from the Airbus parent company. The carmaker wants to quickly sell its 7.5 per cent; in addition the Dedalus private investors want to part with a 4.5 percent share.