EADS execs try to recoup after shares massacre

19th June 2006, Comments 0 comments

PARIS, June 19, 2006 (AFP) - The European aerospace group EADS will hold its first board meeting Monday since its stock plunged by more than 25 percent on a profit warning last week, French junior industry minister François Loos said.

PARIS, June 19, 2006 (AFP) - The European aerospace group EADS will hold its first board meeting Monday since its stock plunged by more than 25 percent on a profit warning last week, French junior industry minister François Loos said.

The meeting, which comes amid flatly-denied allegations of insider trading, will be presided by EADS co-chairmen Arnaud Lagardère and Manfred Bischoff, Loos told LCI television.

According to the French financial daily Les Echos, which did not name its sources, the company was unlikely to make any radical decisions pending an internal group investigation of the incident, which was sparked by a serious delay in deliveries of the A380 super-jumbo jet built by EADS' Airbus unit.

EADS co-chief executive Noël Forgeard has flatly denied accusations he knew about the problems associated with the plane's development before he sold EUR 2.5 million in stock options in March.

According to Les Echos, the European Aeronautic Defence and Space company was first alerted to a risk to deliveries on April 15, which was subsequently confirmed by an external audit.

The news, coupled with a profit warning, sparked losses of EUR 5.5 billion in EADS shares on Wednesday, when the group saw more than a quarter of its market value wiped out.

EADS shares subsequently regained some ground, but over the five days ending Friday the stock had still lost 25.05 percent.

Les Echos said the affair would prompt EADS to rethink its dual chief executive structure and might encourage its principal German shareholder, DaimlerChrysler, to dispose of its remaining 22.32 percent stake.

Les Echos added that regional German banks might be willing to acquire the shares.

A stake of 22.32 percent is also held by French interests comprised of the state and the media group Lagardère.

The daily Le Figaro said Monday that the board meeting would take place in Munich, and it would be the first chance for Bischoff, EADS' German co-chairman, to comment on the affair.

But Forgeard told the French financial daily La Tribune there was no dissention among EADS' French and German directors.

"I see no elements that would feed any sort of dissention between the French and the Germans," he was quoted Monday as saying.

We are managing this crisis together with (German co-chief executive) Tom Enders and Gustav Humbert," the president of Airbus.

"I condemn these attempts to try and systematically ascribe any questions about EADS to clashes between French and Germans. The war is over."

Copyright AFP

Subject: French news

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