Germany to buy Daimler's shares in EADS
The German government and carmaker Daimler announced Thursday an agreement to transfer a 7.5-percent stake in European aerospace and defence giant EADS to Germany's state-owned bank KfW.
"Daimler and the German federal government have agreed in principle that state-owned KfW bank group will take over a 7.5-percent equity interest in the European Aeronautic Defence and Space Company from Daimler," the automaker said in a statement.
"The sale is slated to take place in 2012. A letter of intent to that effect is to be signed by KfW and Daimler before the end of this year."
EADS, which makes Airbus passenger jets and European Ariane rockets, was founded in 2000 from a merger of French, German and Spanish aerospace companies.
Given the high strategic importance and sensitivity of its fields of activity, France and Germany have jealously sought to maintain equal influence over EADS, with groups Daimler and Lagardere currently representing their respective interests.
However, the balance of power looked set to be redrawn when Daimler -- which currently holds a stake of 15 percent and 22 percent of the voting rights in EADS -- annnounced it was looking to unload its shares to focus on its core car and trucks businesses.
At one point, Qatar Holdings had been mooted as a potential buyer.
The German government has been unsuccessful so far in finding a private buyer for the Daimler shares, whose current market value stands at 1.2-1.3 billion euros ($1.6-1.8 billion). As a result, it found itself compelled to step into the breach.
Nevertheless, "the door remains open for potential private investors," the economy ministry insisted in a statement on Thursday.
Daimler said that due to the strategic importance of EADS, "the government has decided to safeguard the German-Franco balance through its investment by KfW bank group.
"As a result, one of the decisive factors for the success of EADS is maintained and an equivalent shareholder structure between the two sides is achieved," said Daimler board member Bodo Uebber.
Daimler, as one of the co-founders of EADS, "remains committed to its role of industrial leadership on the German side," Uebber added.
Under the terms of the deal, Daimler and KfW will pool their voting rights in an intermediate holding company and Daimler would retain its "leadership role" on the German side.
KfW is where the German government has parked other key shareholdings, such as its remaining stakes in the former state monopolies Deutsche Telekom and Deutsche Post.
The economy ministry said Thursday that "notwithstanding the decision to take over Daimler's shares in EADS, the government will continue to pursue its policy of reducing state influence in private companies."
It was continuing to examine opportunities to further reduce its stakes in Deutsche Telekom and Deutsche Post depending on market conditions, the ministry added.
© 2011 AFP