Airbus' Forgeard gets nod as new EADS co-chief

17th December 2004, Comments 0 comments

PARIS, Dec 17 (AFP) - French interests named on Friday the head of Airbus, Noel Forgeard, to be one of two new pilots running the European aeronautics and defence group EADS after weeks of reported tension over his role.

PARIS, Dec 17 (AFP) - French interests named on Friday the head of Airbus, Noel Forgeard, to be one of two new pilots running the European aeronautics and defence group EADS after weeks of reported tension over his role.

The decision opens a new chapter of management at the European Aeronautic Defence and Space Company, raises prospects for a merger between EADS and the French defence electronics group Thales, and leaves open the contest for candidates to succeed Forgeard at Airbus Industrie.

The French side of EADS named Forgeard to represent their interests at the helm of the enterprise's Franco-German management structure next year.

The French government and the media and defence group Lagardere, which together own 30 percent of EADS, said they had decided that Forgeard should succeed Philippe Camus when the current dual Franco-German executive mandate expires in July.

The simultaneous announcements ended weeks of divisive rumours over the French succession to the dual management team, led by Camus and by Rainer Hertrich of Germany since the creation of the European giant in July 2000.

The finance ministry announced its support for the nomination of Forgeard.

Earlier Arnaud Lagardere had said in a newspaper interview that Camus would return to work with him.

"The mission of launching EADS has indeed been thoroughly completed and so quite naturally Philippe comes back to work with me," he said in Friday's edition of Le Figaro.

One industry analyst in France, who declined to be named, also said that the nomination "spotlights the project for closing links (between EADS) and Thales".

He explained: "It was Forgeard who pushed for a merger of EADS and Thales. In addition, he gets on well with (Thales chairman) Denis Ranque.

And he wants to keep all of the defence activities within EADS and is against any dismantling of Thales. This is a standpoint which could interest the Thales board."

The price of EAD shares rose by 1.05 percent to EUR 21.15 in a falling market in mid-day trading. SG Securities analyst Zafar Khan commented: "There's broad relief about Forgeard's nomination. We believe he has done a very good job at Airbus."

The possibility of Thales being dismantled has arisen as a result of speculation that the two main shareholders, Alcatel with 9.5 percent and Dassault with 5.7 percent, might withdraw, taking some assets with them.

Forgeard said on Thursday that an alliance between EADS and Thales would create the second-biggest group of mixed aeronautical-electronics capabilities in the world after Boeing.

The French state owns 15 percent of EADS and 31.3 percent of Thales. Lagardere said that a decision on who would replace Forgeard would be taken at the beginning of next year in consultation with German shareholders of EADS and also of the British group BAE Systems which owns 20 percent of Airbus. EADS owns 80 percent.

Leading names mentioned as candidates to head the aircraft manufacturer are Fabrice Bregier, the head of EADS Eurocopter, the helicopter division, and Airbus vice president Gerard Blanc.

Forgeard is expected to take up his functions alongside Thomas Enders, the current head of EADS's armaments division who has been named as the likely successor to German co-chief executive Hertrich.

Enders was named by the German-US auto maker DaimlerChrysler, which owns 30 percent of EADS.

Hertrich, who had a close relationship with Camus at the helm of EADS, unexpectedly announced he would resign earlier this month, reportedly in anger at French efforts to install Forgeard.

Arguments over the control of EADS - which makes 60 percent of its profits from its Airbus airliner subsidiary - have caused serious tensions between France and Germany in recent weeks.

Forgeard raised eyebrows last month, especially on the German side, when he suggested that EADS would be better managed without the dual Franco-German structure.

"Noel Forgeard and Thomas Enders have a vocation to take over from Philippe Camus and Rainer Hertrich in order to lead a new stage of industrial history and of the development of EADS," France's finance ministry said in a statement.

"Finance Minister Herve Gaymard is eager to salute the achievements of Mr Camus and Mr Hertrich since EADS's creation, which have turned it into a world-class enterprise... and a great Franco-German success story," it said.


Subject: French News

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