EADS, BAE Systems ask for help to settle row

8th June 2006, Comments 0 comments

PARIS, June 7, 2006 (AFP) - British defence group BAE Systems and EADS might appoint an investment bank to help settle a wrangle over the value of BAE's 20-percent stake in European aircraft maker Airbus, which the companies jointly own, EADS said Wednesday.

PARIS, June 7, 2006 (AFP) - British defence group BAE Systems and EADS might appoint an investment bank to help settle a wrangle over the value of BAE's 20-percent stake in European aircraft maker Airbus, which the companies jointly own, EADS said Wednesday.

BAE Systems announced in April that it planned to sell its 20-percent stake to EADS, but the two companies have been unable to agree on a price for the shareholding.

"EADS and BAE Systems will seek to finalize their negotiations regarding the sale of BAE Systems' Airbus stake to EADS during the coming weeks," a statement from EADS said.

"If BAE Systems and EADS are unable to agree on the terms of the sale, in accordance with the Airbus shareholders agreement, an investment bank acting as an expert will be appointed to determine the price to be paid by EADS."

In April, the co-chief executive of EADS, Tom Enders, said that BAE Systems was demanding an "astronomic" price for its shares.

EADS has estimated that the 20-percent stake in Airbus is worth about EUR 3.5 billion, but analysts put the value much higher, with Goldman Sachs calculating it to be worth as much as EUR 6.5 billion.

In a research note published on Tuesday, analysts at JP Morgan estimated that the stake was worth about 4.05 billion euros, saying that the final price depended on the valuation methodology.

"EADS retains the right to pay in cash, in shares or a mixture of both," the EADS statement said.

Copyright AFP

Subject: French news

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