EADS
European Aeronautic Defence and Space Company EADS N.V.<tr><td colspan="2" style="text-align:center; padding:16px 0 16px 0;"> | |
| Type | Public (Euronext: EAD, FWB:EAD) |
|---|---|
| Founded | 2000 |
| Headquarters |  Munich, Germany (Registered in Schiphol-Rijk, the Netherlands)<tr><th style="text-align:right; padding-right:0.75em;">Key people</th><td>Thomas Enders (co-CEO) |
The European Aeronautic Defence and Space Company EADS N.V. (EADS) is a large European aerospace corporation, formed by the merger on July 10, 2000 of Aérospatiale-Matra of France, Construcciones Aeronáuticas SA (CASA) of Spain, and DaimlerChrysler Aerospace AG (DASA) of Germany. The company develops and markets civil and military aircraft, as well as missiles, space rockets, and related systems.
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History and activities
EADS was formed by its member companies in July 2000, to become the world's second largest aerospace company (after Boeing). EADS is also the second-largest European arms manufacturer (after BAE Systems.)
In early 2001 EADS and its partner in Airbus, BAE Systems, agreed to establish it as a fully integrated company. Airbus formally achieved this on 12 July 2001. This new arrangement saw the shareholdings established at 80% (EADS) and 20% (BAE). In April 2001 EADS agreed to merge its missile businesses with those of BAE Systems and Alenia Marconi Systems (BAE/Finmeccanica) to form MBDA. EADS took a 37.5% share of the new company which was formally established in December 2001.
On 16 June 2003 EADS acquired BAE's 25% share in Astrium, the satellite and space system manufacturer, to become the sole owner. EADS renamed the company EADS Astrium. In November 2003, EADS announced that it was considering working with Japanese companies, and the Japanese METI, to develop a hypersonic airliner intended to be a larger, faster, and quieter, replacement for the Concorde, which was retired in October the same year.
Management
EADS operates with two co-CEOs, one French, Louis Gallois, and one German, Thomas Enders. Similarly the leadership of the board of directors is shared between two co-chairmen: Arnaud Lagardère and Manfred Bischoff. This system was established with the creation of EADS in 2000. Members of the board of directors of EADS are: Manfred Bischoff, François David, Juan Manuel Eguiagaray, Thomas Enders, Noël Forgeard, Louis Gallois, Rüdiger Grube, Jean-Paul Gut, Arnaud Lagardère, Hans Peter Ring, Michael Rogowski.
In late 2004 Noël Forgeard (then Airbus CEO) was nominated by Lagardère as the next French CEO of EADS. Forgeard had suggested that this system should be abolished in favour of a single CEO in a move that DaimlerChrysler saw as an attempt to engineer a French dominated management team. Following protracted arguments, which caused embarrassment to EADS at the Paris Air Show, the appointment was confirmed by the EADS Board of Directors on June 25, 2005. At the same meeting the Board, in consultation with partner BAE Systems, named Gustav Humbert as President and CEO of Airbus.
On June 2, 2006 co-CEO Noël Forgeard and Airbus CEO Gustav Humbert resigned following the controversy caused by the June 2006 announcement that deliveries of the A380 would be delayed by a further six months. Forgeard was also under pressure due to the fact that he had sold EADS stock weeks before the A380 announcement which caused a 26% slump in the share price.
EADS divisions
Airbus Division
Airbus S.A.S. was 80% owned by EADS, with BAE Systems owning the remaining 20%. In September 2006, both companies announced a transaction of all stock from BAE Systems to EADS, meaning that Airbus will be fully owned by EADS. Airbus headquarters are located in Toulouse, France.
In March 2006, reports in the British press intensified about the possibility of a sale, with BAE's 20% "conservatively valued" at €3.5 billion EUR ($4.17 bn USD). On April 6, 2006 BBC News reported that BAE Systems was selling its share.[1] The move was seen by many analysts as a move to make partnerships with U.S. firms more feasible, in both financial and political terms.[2] BAE originally sought to agree a price with EADS through an informal process. However due to the slow pace of negotiations and disagreements over price, BAE exercised its put option which saw investment bank Rothschild appointed to give an independent valuation. Following the announcement in June 2006 that Airbus would delay deliveries of the A380 by up to seven months reports appeared questioning the impact on the value of BAE's share of Airbus. The Independent described a "furious row" between BAE and EADS, with BAE believing the announcement was designed to depress the value of its share. [3]
On 2 July 2006 Rothschild valued BAE's stake at £1.9 billion (€2.75 billion); well below the expectation of BAE, analysts and even EADS. [4]
On 6 September 2006, BAE agreed to sell its stake in Airbus to EADS for £1.87 billion (€2.75 billion, $3.53 billion), pending BAE shareholder approval. [5] The deal closed on October 13, 2006.
Eurocopter Division
Eurocopter is a manufacturer of light and medium civil and military helicopters. The CEO is Fabrice Brégier and the headquarters are in Marignane, France.
Military Transport Aircraft Division
EADS produces military transport aircraft, mainly through Airbus' majority ownership of Airbus Military. It is the developer and manufacturer-to-be of the Airbus A400M – competitor to Lockheed Martin's C-130 Hercules. It manufactures the A310 MRTT and A330 MRTT conversions. Within the 2007 US defense budget the USAF has set aside $8.5 billion to buy aerial refueling tankers, starting with four per year from 2010- 2013 and rising to 15 a year starting in 2014. Boeing and EADS North America would compete for this program, replacing a single-source tanker program that was slated for Boeing.
EADS Space
The Space division consists of three sub-divisions:
- EADS Astrium, a satellite company. EADS Astrium is based in Toulouse, France, and the CEO is Antoine Bouvier. The number of employees, as of 2004, is 6,092, spread among four countries: France (40%), UK (35%), Germany (21%), and Spain (4%).
- EADS SPACE Transportation, responsible for the Ariane launchers and orbital systems such as Columbus. The CEO is Alain Charmeau.
- EADS SPACE Services, formed mostly from Paradigm Secure Communications Ltd, a defence satellite operator for the UK MoD (operating the Skynet 5 system)
- 28% shareholder in space transport operator Arianespace (largest commercial shareholder)
- CEO is François Auque.
EADS SPACE has also purchased Dutch Space (former space division of Fokker) in November 2005. EADS is a major contributor to the International Space Station, and is expected to deliver Columbus in 2007 through its subsidiary EADS SPACE Transportation.
Defence & Security Systems Division
The Defence & Security Systems division consists of five sub-divisions.
- EADS Military Air Systems, including products such as the Mako/HEAT, and stakes in the following companies:
- Dassault Aviation (45.76%), manufacturer fighters like the RAFALE or the Mirage 2000.
- Eurofighter GmbH (46%), manufacturer of Eurofighter Typhoon.
- EADS Services
- Missiles
- Defence Electronics, the sensors and avionics house of EADS
- Defence and Communications Systems, electronics/software system house
EADS North America
EADS North America is the U.S. holding company for the North American activities of EADS. It is chaired by Ralph Crosby.
Other
EADS Socata is a manufacturer of small aircraft.
Dresden Elbe Flugzeugwerke (EADS EFw) convert aircraft into freighter.
Shareholders
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As of 31 December 2004, about one-third of EADS stock is publicly traded on six European stock exchanges and the rest is divided among three major shareholders. [1][2]
![[1]](http://www.eads.com/xml/content/OF00000000400004/1/69/29666691.gif){kind=link}
- Publicly traded: 34.08% (Includes 3.55% held by EADS employees, 0.06% held by French government, and 0.78% held as treasury stock. Traded on Euronext Paris, the Frankfurt Stock Exchange, and the Madrid, Bilbao, Barcelona and Valencia stock exchanges.)
- DaimlerChrysler: 30.17%
- SOGEADE: 30.17% (15.185% French government, 15.185% Lagardère)
- SEPI: 5.51% (Spanish state holding company)
On July 17, 2004 The Economist reported that the three major shareholders, DaimlerChrysler, SOGEADE and SEPI, intend to sell their shares by 2006–2007. DaimlerChrysler would like extra capital to invest in its core activities, Lagardère wants to withdraw from defence aerospace, and the French government is pursuing privatisation where appropriate.
On April 4, 2006, DaimlerChrysler announced its intention to reduce its shareholding from 30% to 22.5%. The company places a value of the stake at "approximately €2.0 billion." [6] Lagardère will reduce its holding by an identical amount. However, Caisse des Dépôts et Consignations, a unit of the French government, acquired 2.25% of EADS. At issue as a result is the fact that the German and French shareholdings are now in imbalance.[7]
On August 30, 2006, shortly after the stock price decline caused by the A380 delivery delays, more than 5% of EADS stock has been reportedly purchased by the Russian state-owned Vneshtorgbank.[8]
On October 3, 2006, shortly after EADS admitted further delays in the Airbus 380 program would cost the company 4.8 billion euros in lost earnings in 2010, EADS shares, traded on the Paris arm of Euronext, were suspended after they surpassed the 10 per cent loss limit. Trading resumed later in the day with the one day loss holding at 7 per cent [3].
In October 2005 the British Ministry of Defence warned European politicians to stop, as it sees it, interfering in the corporate governance of EADS. The UK Defence Procurement Minister Lord Drayson has hinted that the UK government, a major customer for EADS, may withhold future contracts. "As a key customer, we see it as important for EADS to move in a direction that is free from political interference." [9]
Criticism
As a result of criticisms, the Norwegian Government Pension Fund - Global’s Advisory Council on Ethics recommended, in 2005, that the Ministry of Finance should exclude this company from the Pension Fund, arguing that EADS manufactures "key components for cluster bombs". As a result, since 2 September 2005, EADS and its sister company EADS Finance BV have been excluded from the investment portfolios of the Norwegian Government Pension Fund.[10]
Alleged Insider Dealing
News reports in June 2006 focussed on possible insider dealing at EADS. Joint CEO Noël Forgeard made a 2.5 million Euro profit on the sale of EADS shares just weeks before news was released of delays to the A380.
See also
References
- ^ "BAE Systems to sell Airbus stake." BBC News. April 6, 2006.
- ^ "BAE in Talks With EADS to Sell its 20% Airbus Stake; British Firm is Focusing Increasingly on Defense Market, Especially in U.S." Michaels, D. The Wall Street Journal. April 7, 2006.
- ^ BAE launches attack on EADS over Airbus superjumbo warning The Independent. Retrieved 15th June, 2006
- ^ "BAE under pressure to hold Airbus stake" The Guardian Retrieved 3 July 2006
- ^ "BAE agrees to £1.87bn Airbus sale", BBC News, 2006-09-06. Retrieved on 2006-09-06.
- ^ DaimlerChrysler And Lagardere Cut Stake In EADS
- ^ "Airbus plays catch-up with A350 jet." Phillips, D. International Herald Tribune. April 11, 2006.
- ^ "EADS shares up on Vneshtorgbank reports." Yahoo News. August 30, 2006.
- ^ Roberston, David. "MoD tells European leaders to stop meddling in EADS", The Times, 2006-10-05. Retrieved on 2006-10-15.
- ^ Press Release: A Further Eight Companies Excluded from the Petroleum Fund
External links
- Corporate website
- EADS North America
- Yahoo! — European Aeronautic Defence and Space Company EADS N.V. Company Profile
- http://www.worldsecuritynetwork.com/showArticle3.cfm?article_id=13407 By Ioannis Michaletos
| Members and holdings of DaimlerChrysler : |
|---|
| Chrysler Group: Chrysler | Dodge | Jeep |
| Defunct Marques: Barreiros (1959-1978) | Commer (1905-1979) | DeSoto (1928-1961) | Eagle (1988-1998) | Fargo (1920-1972) | Hillman (1907-1976) | Humber (1898-1975) | Imperial (1955-1975, 1981-1983) | Karrier (1908-1977) | Plymouth (1928-2001) | Simca (1934-1977) | Sunbeam (1901-1976) | Singer (1905-1970) | Valiant (1960-1966) |
| Mercedes Car Group: Global Electric Motorcars (GEM) | Maybach | Mercedes-Benz | Mercedes-AMG | Smart |
| Commercial Vehicle Brands: Freightliner | Mercedes-Benz | Mitsubishi Fuso Truck and Bus | OriOn | Setra | Sterling Trucks | Thomas Built Buses | Western Star |
| Participations in: EADS (30.17%) | Mitsubishi Fuso Truck and Bus (85%) | Freightliner | McLaren Group (40%) |
| v • • e</span> |  |
|---|---|
Aareal Bank AG |AMB Generali Holding AG |AWD Holding AG |Beiersdorf AG |Bilfinger Berger AG |Celesio AG |DEPFA BANK plc | |
| v • • e</span> |  | |
|---|---|---|
Accor |AGF |Air Liquide |Alcatel-Lucent |Alstom |Arcelor-Mittal |AXA |BNP Paribas |Bouygues |Capgemini |Carrefour |Crédit Agricole | | ||
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