British arms manufacturer BAE Systems and European planemaker EADS said on Wednesday they are in merger talks to create a global aerospace and defense leader that would better rival US giant Boeing.
“BAE Systems PLC and EADS confirm that they are in discussions regarding a possible combination of their businesses,” the companies said in a joint statement that confirmed feverish market speculation.
The talks envisaged BAE Systems owning 40 percent of the enlarged group, with EADS holding a majority 60 percent stake.
“The potential combination would create a world class international aerospace, defence and security group with substantial centres of manufacturing and technology excellence in France, Germany, Spain, the UK and the USA,” it added.
The new group would manufacture products ranging from Airbus passenger jets and military transporters to Challenger tanks, Tornado jet fighters and aircraft carriers. It would have a unified board and management structure with identical boards and executive committees at each of BAE and EADS.
“This potential combination would be implemented through the creation of a dual listed company structure, under which both companies would operate as one group by means of equalisation and other agreements but would be separately listed on their existing exchanges,” the statement added.
The two groups have a history of collaborating. They are already partners in joint ventures including the Eurofighter project and MBDA missile systems.
BAE is an expert in the field of defense, security and military, whereas most of EADS’ work is in the commercial sector with its Airbus jet division.
A merger would help EADS make headway in the US, which until now it has struggled to do, Guy Anderson, senior principal analyst at IHS Jane’s Defence Industry said.
“BAE systems now is far bigger in the US than it is in Europe” he said.
In Washington, Boeing CEO Jim McNerney said on Wednesday they saw no threat from the planned merger.
“I have a pretty deep and abiding faith in our company’s strength, okay, so I don’t see this as something that is going to threaten us fundamentally,” he said.
“I think this may be a matter of, from an EADS standpoint, maybe some increased US market access” because of BAE’s presence in the US, he said.
BAE and EADS said they had agreed to ringfence certain defense activities, especially in the US.
“Under the transaction structure being discussed ... BAE Systems and EADS envisage that certain of their defence activities would be ringfenced with governance arrangements appropriate to their strategic and national security importance, particularly in the USA, given the importance of that market to the enlarged group,” the statement added.
News of the proposed deal, which remains subject to shareholder approvals, sent BAE shares surging, but EADS stock dived.
BAE shares rocketed 7.39 percent to £3.53 on London’s FTSE 100, which finished down 0.17 percent at 5,782.08 points. In Paris, EADS stock sank 5.63 percent to 28 euros on the CAC 40, which ended up 0.18 percent at 3,543.79 points.
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
RECORD-BREAKING: TSMC’s net profit last quarter beat market expectations by expanding 8.9% and it was the best first-quarter profit in the chipmaker’s history Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), which counts Nvidia Corp as a key customer, yesterday said that artificial intelligence (AI) server chip revenue is set to more than double this year from last year amid rising demand. The chipmaker expects the growth momentum to continue in the next five years with an annual compound growth rate of 50 percent, TSMC chief executive officer C.C. Wei (魏哲家) told investors yesterday. By 2028, AI chips’ contribution to revenue would climb to about 20 percent from a percentage in the low teens, Wei said. “Almost all the AI innovators are working with TSMC to address the
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”