PARIS — Shares of BAE Systems and EADS, the owner of Airbus, fell Thursday, a day after the two aerospace companies said they were in merger talks, as a key shareholder in EADS said it wanted to examine the deal closely before giving its consent.
BAE and EADS, whose full name is European Aeronautic Defense & Space, said Wednesday they were in talks to create an industry leader that would overtake Boeing. Airbus’s American rival, in sales and contend with defense cutbacks in Europe and the United States.
The French conglomerate Lagardère, which owns 7.5 percent of EADS, said Thursday it “intends to ensure that all consequences associated” with the proposed merger “are taken into consideration in determining the terms and conditions of the proposed transaction before it consents to the deal.”
Shares in BAE were down 5.2 percent at 344.60 pence Thursday morning in London. Shares in EADS were down 5.5 percent at €26.46 in Paris.
Lagardère owns 7.5 percent of EADS as part of a pact designed to maintain the balance between the company’s French and German shareholders. The French state also owns 7.5 percent, while the German automaker Daimler holds 15 percent.
Daimler confirmed after the talks were reported on Wednesday that it planned to reduce its stake in EADS by the end of this year. Germany has agreed, via a state-owned bank, KfW, to buy half of Daimler’s stake to ensure the French-German balance.
Any deal between BAE and EADS would probably help Lagardère unload its stake and enable it to return a large chunk of the proceeds to shareholders, Charles Bedouelle, an analyst at Exane BNP Paribas, wrote in a note.
“Lagardère has wanted to sell its 7.5 percent stake in EADS for a long time, but internal constraints and the need to respect a French-German balance among shareholders have made a disposal difficult — especially as there is no obvious French buyer,” Mr. Bedouelle wrote.
The potential deal would give BAE shareholders 40 percent and EADS investors 60 percent of a combined group with a dual stock listing. The new group’s products would range from Airbus commercial jets and military transport planes to the BAE-made Eurofighter Typhoon jets and Astute class nuclear-powered submarines.
Combined, BAE and EADS would have sales of about €72 billion, or $93 billion, based on 2011 numbers, and 220,000 employees worldwide.
BAE and EADS, whose full name is European Aeronautic Defense & Space, said Wednesday they were in talks to create an industry leader that would overtake Boeing. Airbus’s American rival, in sales and contend with defense cutbacks in Europe and the United States.
The French conglomerate Lagardère, which owns 7.5 percent of EADS, said Thursday it “intends to ensure that all consequences associated” with the proposed merger “are taken into consideration in determining the terms and conditions of the proposed transaction before it consents to the deal.”
Shares in BAE were down 5.2 percent at 344.60 pence Thursday morning in London. Shares in EADS were down 5.5 percent at €26.46 in Paris.
Lagardère owns 7.5 percent of EADS as part of a pact designed to maintain the balance between the company’s French and German shareholders. The French state also owns 7.5 percent, while the German automaker Daimler holds 15 percent.
Daimler confirmed after the talks were reported on Wednesday that it planned to reduce its stake in EADS by the end of this year. Germany has agreed, via a state-owned bank, KfW, to buy half of Daimler’s stake to ensure the French-German balance.
Any deal between BAE and EADS would probably help Lagardère unload its stake and enable it to return a large chunk of the proceeds to shareholders, Charles Bedouelle, an analyst at Exane BNP Paribas, wrote in a note.
“Lagardère has wanted to sell its 7.5 percent stake in EADS for a long time, but internal constraints and the need to respect a French-German balance among shareholders have made a disposal difficult — especially as there is no obvious French buyer,” Mr. Bedouelle wrote.
The potential deal would give BAE shareholders 40 percent and EADS investors 60 percent of a combined group with a dual stock listing. The new group’s products would range from Airbus commercial jets and military transport planes to the BAE-made Eurofighter Typhoon jets and Astute class nuclear-powered submarines.
Combined, BAE and EADS would have sales of about €72 billion, or $93 billion, based on 2011 numbers, and 220,000 employees worldwide.