£28bn EADS-BAE Systems merger scrapped

A £28 billion mega merger between Airbus boss EADS and defence giant BAE Systems has been scrapped.

After weeks of political wrangling, the aerospace giants confirmed the deal had been discarded after lengthy talks between UK, German and French government representatives.

The union would have created a defence titan with combined sales of £60billion and more than 220,000 staff, with around 52,000 employees in the UK, including 6,000 at the Airbus wing-making plant in Broughton.

BAE said it had become clear the interests of government stakeholders – including those in France and Germany – could not be reconciled with each other or with the company’s objectives.

Unions believed the link-up would have created a strong company to guarantee jobs in the long term.

BAE chief executive Ian King said the British business remained “strong and financially robust” and added: “We are obviously disappointed that we were unable to reach an acceptable agreement with our various government stakeholders.”

EADS chief executive Tom Enders was disappointed with the move but “glad we tried”.

“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,” he said.

“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. EADS will continue on its international growth path and our shareholders can continue to expect profitable growth, excellent liquidity and programme execution based on a strong order book.”

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