A PLANNED ‘super merger’ between BAE Systems and the company which owns Astrium in Portsmouth and Eurocopter in Gosport has been called off.
The proposed £28billion merger of defence giants BAE Systems and EADS would have created the world’s largest defence and aerospace firm, overtaking Boeing in the US.
Locally, it would have meant satellite firm Astrium and helicopter manufacturer Eurocopter would have been working for the same company as Portsmouth’s Royal Navy shipbuilders and its mission systems engineers.
In a joint statement, issued at lunchtime yesterday, BAE and EADS said the sticking point in the deal was getting the British, French and German governments to agree to the terms of the merger.
Unions believed the link-up would have created a strong company to guarantee jobs in the long term.
The merger would have created a defence titan with combined sales of £60 billion and more than 220,000 staff, with around 52,000 employees in the UK alone.
Ian King, chief executive of British-based BAE Systems, said: ‘We are obviously disappointed that we were unable to reach an acceptable agreement with our various government stakeholders.
‘We believe the merger presented a unique opportunity for BAE Systems and EADS to combine two world class and complementary businesses to create a world leading aerospace, defence and security group.’
He added: ‘We remain committed to delivering total shareholder value, including a progressive dividend policy, and look to the future with confidence.’
Tom Enders, chief executive of EADS, which is based in both France and Germany, added: ‘I’d like to thank everybody who supported us, in particular all the colleagues at BAE Systems and EADS for all their hard work and dedication to this project in recent months.
‘A special thank-you goes to Ian King for his trust and partnership.
‘It is, of course, a pity we didn’t succeed but I’m glad we tried.
‘I’m sure there will be other challenges we’ll tackle together in the future.’