BAE-EADS Merger: A Tough Call Ahead

The proposed tie-up between BAE Systems and EADS appears to be gaining senior political support in the United Kingdom. However, non-committal comments to date from French President Hollande and German Chancellor Merkel confirm that negotiations over the terms of the merger have now entered their most sensitive phase. Depending on how the negotiations go, the UK's coalition government may be confronted with a most unexpected and intriguing challenge: whether or not the government should acquire its own stake in the merged company.

ESO: Background information: EADS, BAE in talks to create European aerospace giant http://www.europeansources.info/record/eads-bae-in-talks-to-create-european-aerospace-giant/

Chatham House: Expert Comment: BAE-EADS Merger: Possible Implications for UK Defence Sector, September 2012 http://www.chathamhouse.org/media/comment/view/185971

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