German state to buy more of EADS

THE GERMAN government plans to buy a bigger stake of up to 12 per cent of EADS from Daimler and private banks, a government source…

THE GERMAN government plans to buy a bigger stake of up to 12 per cent of EADS from Daimler and private banks, a government source said yesterday, in a sign it wants to defend national interests in the European aerospace group.

“The draft of the supplementary budget foresees €1.6 billion for this purpose,” the source said.

Germany had already said it would buy a 7.5 per cent stake in EADS from Daimler. The additional 4.5 per cent will come from the Dedalus consortium, belonging to private banks.

A spokeswoman for the economy ministry said it had made provisions to buy further EADS shares in the event that private banks wished to sell them. In taking a larger stake in EADS, the parent of aircraft-maker Airbus, the government may well add to tensions over site locations at the group, which has already warned Germany it will not tolerate meddling.

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EADS chief executive Louis Gallois earlier this month defended plans by his German designated successor, Tom Enders, to refocus more of the group’s activities near Airbus headquarters in Toulouse, France, despite some misgivings in chancellor Angela Merkel’s government. – (Reuters)