Airbus shareholder contemplates selling shares

BAE, the British aerospace company, is in talks to sell its 20% holding in Airbus while the company is still propserous. Airliner wars may sap its performance, as Boeing bounces back. The Wall Street Journal ($link) reports:

While a buyout of BAE's Airbus stake won't alter the competitive or industrial landscape noticeably in the short term, it would have subtle and potentially significant implications. As a wholly owned subsidiary of EADS, Airbus would have cleaner and simpler lines of reporting that might speed decision—making at the French, German, British and Spanish plane maker. That might help Airbus better compete against Boeing as the U.S giant is shaking off years of trouble and moving fast to reclaim its lost market dominance.

Airbus and EADS face tough and potentially expensive decisions on how to alter key A340 and A350 widebody models to better compete with Boeing's hot—selling 777 and 787 models. Airbus was publicly urged last week by its biggest customer, Steven Udvar—Hazy, chairman of U.S aircraft—leasing powerhouse International Lease Finance Corp., to spend several billion dollars on improving the new A350.

Airbus could well benefit from a less cumbersome bureaucracy, but it will still have to navigate the bureaucratic shoals of the EU and the French state that will remain a major shareholder.

Hat tip: Dennis Sevakis

Thomas Lifson   4 7 06

BAE, the British aerospace company, is in talks to sell its 20% holding in Airbus while the company is still propserous. Airliner wars may sap its performance, as Boeing bounces back. The Wall Street Journal ($link) reports:

While a buyout of BAE's Airbus stake won't alter the competitive or industrial landscape noticeably in the short term, it would have subtle and potentially significant implications. As a wholly owned subsidiary of EADS, Airbus would have cleaner and simpler lines of reporting that might speed decision—making at the French, German, British and Spanish plane maker. That might help Airbus better compete against Boeing as the U.S giant is shaking off years of trouble and moving fast to reclaim its lost market dominance.

Airbus and EADS face tough and potentially expensive decisions on how to alter key A340 and A350 widebody models to better compete with Boeing's hot—selling 777 and 787 models. Airbus was publicly urged last week by its biggest customer, Steven Udvar—Hazy, chairman of U.S aircraft—leasing powerhouse International Lease Finance Corp., to spend several billion dollars on improving the new A350.

Airbus could well benefit from a less cumbersome bureaucracy, but it will still have to navigate the bureaucratic shoals of the EU and the French state that will remain a major shareholder.

Hat tip: Dennis Sevakis

Thomas Lifson   4 7 06