BAE and EADS in talks over €34bn merger extension
AN Anglo-French breakthrough over state shares in a $45bn (€34.9bn) arms merger between EADS and BAE Systems made an extension of a negotiating deadline more likely, but put the two nations on a potential collision course with Germany.
With today's 4pm deadline fast approaching, both boards met to decide whether to keep their merger hopes alive by seeking a roughly two-week extension to complete their deal.
British Defence Minister Philip Hammond said the groups now had a clear idea of government "red lines" for the complex and sensitive deal. He expected them to say whether they would seek an extension before the London stock market opens today.
The decision is a critical one for Tom Enders, the head of EADS and BAE counterpart Ian King, who have staked their companies' reputations on realising a decade-old plan for a defence giant based in Europe.
"Ian King and Tom Enders will discuss the situation later today and then decide, jointly with the respective company boards, the way forward," EADS said in an emailed statement.
In an important change of tone, sources said France and Britain had significantly narrowed differences over the wording of guarantees on state shareholdings in the merger to create the world's biggest arms and aerospace group.