Defence giant in merger bid

BAE Systems, Warton. Mark Menzies (MP for Fylde)
BAE Systems, Warton. Mark Menzies (MP for Fylde)
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DEFENCE giant BAE Systems today confirmed talks over a potential merger with Airbus aircraft manufacturer EADS to create the world’s biggest aerospace and defence company.

BAE said a tie-up with European Aeronautic, Defence & Space (EADS) would form a “world class” firm in its sector, with combined sales of £60bn and around 220,000 staff.

The merged group would employ around 48,000 in the UK. It is not known what impact the move would have on its 11,000 Lancashire workers.

A BAE spokesman said it was too early to confirm whether there would be any job losses, but stressed there was little overlap between the two business activities.

Fylde MP Mark Menzies said his priority is to ensure the future of BAE’s headquarters at Warton is not compromised.

He said: “I have been in touch with BAE and defence ministers to clarify what affects this would have on the Warton site. Warton is the headquarters of BAE Systems military air solutions and my overwhelming priority is to ensure their future is not compromised by this potential merger.

“I will be looking to work closely with the company and unions in the coming days, weeks and months to ensure that, if this merger goes ahead, Warton remains the heart of the military air solutions division of the company.”

BAE said the proposed deal would be a merger, but would see BAE shareholders own 40 per cent of the combined group and EADS shareholders own 60 per cent.

The two groups are working on plans to create a combined firm that would retain its dual listing.

BAE said: “BAE Systems and EADS have a long history of collaboration and are currently partners in a number of important projects, including Eurofighter.”

Both firms have until 5pm on October 10 to announce a deal or walk away.