Investor in EADS urges a review of defence merger

EADS shareholder Lagardère, which holds seven per cent of the defence and aerospace company, has voiced its concern over the proposed £30bn merger with BAE.

The Paris-based publishing group, whose chief executive is also chairman of EADS, said yesterday that it couldn’t see how the merger would create value for the aerospace group.

It said that an urgent review of the merger was “indispensable”, adding that the conditions of the merger, which call for a 60:40 split between EADS and BAE in the enlarged firm, were “unsatisfactory”.

Fellow EADS shareholder Daimler, which holds 15 per cent of the company, has expressed concern with the merger previously, and said it plans to reduce its stake in the French aerospace firm if the merger gets the green light.

A source close to the transaction said talks with respective governments were still progressing well ahead of the 10 October deadline for both EADS and BAE to provide more information on the tie-up.

Both firms need the approval from the various governments for the deal to proceed.

BAE and EADS declined to comment on Lagardère’s statement yesterday.