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Daimler sells EADS stake to concentrate on car business

DAIMLER, the world's third-largest maker of luxury cars, has sold its remaining stake in Airbus parent European Aeronautic, Defence & Space (EADS) for €2.2bn to focus on its car business.

The Mercedes maker disposed of 61.1 million shares in EADS, equal to 7.5pc of the total, at €37 a share, said the Stuttgart-based automaker. EADS bought 16 million of the shares for €600m.

The carmaker, which was among the founding forces behind Toulouse-based EADS more than a decade ago, has lost ground to BMW and Volkswagen's Audi in vehicle sales, a gap that chief executive Dieter Zetsche has pledged to close.

Daimler pushed back long-standing profit targets in October and has initiated a cost-cutting plan amid a slowdown in Europe's automotive market.

"The EADS stake sale secures a stable dividend payment for 2013," said Sascha Gommel, an analyst with Commerzbank. "It's better for Daimler to invest the money in the company's core business or to spend it to the benefit of the shareholders."

Daimler paid a dividend of €2.20 a share for 2012. (Bloomberg)

Irish Independent