MADRID/STUTTGART/PARIS --- Construcciones Aeronauticas S.A. (CASA, Madrid), the Spanish Number 1 in aerospace, is joining the European Aeronautic Defence and Space Company (EADS) as a founding member. The Agreement to merge CASA, Aerospatiale Matra S.A. (Paris) and DaimlerChrysler Aerospace AG (Dasa, Munich) was signed on Thursday in Madrid in the presence of Chancellor Gerhard Schr?der, Prime Minister José Maria Aznar and Prime Minister Lionel Jospin.
With a workforce of 96,000 and combined revenues of approx. 21 billion Euros, EADS will be one of the three largest aerospace companies in the world and the Number 1 in Europe, with leading positions across all segments.
EADS will combine
**80 percent of Airbus - Number 2 in the world **Eurocopter - Number 1 in the world **Astrium and Arianespace - Number 3 in the world **Airbus Military Aircraft (AMC) - Number 3 in the world **Eurofighter and Dassault - Number 4 in the world **Missile systems - Number 4 in the world
The Business Combination Agreement was signed by the two main industrial shareholders represented by J¸rgen E. Schrempp, Chairman of DaimlerChrysler AG (Stuttgart), together with Dr. Manfred Bischoff, Dasa Chairman and Member of the Board of DaimlerChrysler AG, and Jean-Luc Lagardere, President of the French Lagardere Group as well as Philippe Pontet, Chairman and CEO of SOGEPA (Société GÈnÈrale de Participations AÈronautiques), and Philippe Camus, CEO of Aerospatiale Matra and Co-CEO of the LagardËre group. The Spanish signature was set to the agreement by Pedro Ferreras, President of the Spanish state holding SEPI (Sociedad Estatal de Participaciones Industriales), which currently holds the majority stake in CASA.
"This merger will strengthen the roles of Spain and all of Europe in the aerospace field and thus in the high-tech sector generally," SEPI-President Pedro Ferreras said. "The shareholders of the parent companies and equally the national economies, the employees and the customers will profit from this move. It's a merger of growth. Therefore, EADS will secure and enlarge the Spanish base in high technologies of the future and thus will lead to much better long-term opportunities for employees in a globally active company."
DaimlerChrysler AG together with a French holding company and SEPI will control more than 60 percent of EADS while the remaining stake will be floated on the stock market. The balance between DaimlerChrysler and the French holding which pools the shares of the LagardËre Group, a private French financial institution and the French government, will be maintained. Before floatation of the company, SEPI will hold 6.25 percent of EADS. Jean-Luc LagardËre welcomed CASA as a genuine founding member of EADS.
"Once again, my strategic vision has been confirmed. EADS is undoubtedly the driving force in Europe. Already the Number 3 world-wide with CASA incorporated, EADS has the inner strength to become a global leader," he added. Philippe Pontet, Chairman and CEO of SOGEPA said "We should be proud of this further step in the construction of the European aerospace and defence industry. The addition of Spanish technological expertise will enable the integration of Airbus and priovides EADS with a leading global position."
DaimlerChrysler Chairman J¸rgen E. Schrempp described the trilateral EADS merger as another breakthrough in European aerospace industrial integration. "With CASA joining EADS, the basis for the aerospace business has become decisively more sound. Being the main single shareholder, DaimlerChrysler will play together with LagardËre a leading role in EADS whose foundation will result in a new dimension of profitable growth. We expect integration to move on and DaimlerChrysler will continue to be a driving force in consolidation," he added.
EADS will be directed by a board with Manfred Bischoff and Jean-Luc Lagardere as chairmen. The operational management of the business will be headed by two CEOs and members of the board, Philippe Camus and Rainer Hertrich.
A Spanish member will be named for the board of the holding company as well as for the board of EADS. Two of the EADS divisions will be headed by German and two by French managers while the Transport Aircraft Division will be headed by a Spanish executive. Central functions of EADS will be located in Munich, Paris and Madrid. The company will be registered in the Netherlands.
CASA will modify its current organisational structure in order to incorporate all its activities in the EADS divisions. EADS offers CASA a future perspective by strengthening the Spanish core competencies, consolidating and optimising common programmes and developing new business opportunities both in Spain and on the global market. A significant portion of the workload connected with Airbus programmes will be transferred to CASA. The Spanish company is contributing its family of military transport aircraft to EADS. As Airbus is expanding its activities into military applications (A400M) and CASA has an acknowledged expertise in this field, CASA will lead the combined activities including final assembly, marketing and sales.
CASA has also built up extensive know-how in the field of carbon fibre composites (CFC). Together with the Dasa plant at Stade, Illescas near Madrid will form the CFC Centre in the newly merged company, thus giving EADS a leading role worldwide in composite technology, which will be coordinated.
Manfred Bischoff emphasized: "EADS is open to further partnerships all over the world. In our industry we are the first to join our forces across national borders. SEPI's decision to merge Dasa and CASA in June was the ignition spark for EADS - a fast and wide-ranging integration process that seemed impossible only a few months before. EADS provides a natural platform for restructuring the aerospace industry at a European and a global level."
Philippe Camus added: "The combination of Aerospatiale Matra with Dasa and CASA is a logical and natural development which will increase our joint industrial efficiency and generate higher levels of profitability and value for the employees, the customers and the shareholders." Furthermore, as CASA's President Alberto Fernandez noted, "CASA has broad access to the market, a solid financial base and state-of-the-art technologies at its disposal. Our three companies are combining their excellent capabilities and complement each other perfectly."
CASA increased its profit according to Spanish accounting rules by 20 percent to 47 million Euros in 1998 and is expecting further increases in 1999.
CASA has sold a total of 840 aircraft to 110 operators located in 48 countries. As Aerospatiale Matra and Dasa, CASA earns more than two thirds of its revenues through its worldwide business activities and in international cooperation.
EADS is expected to start operating in the first half of 2000 after approval from the regulatory and supervisory authorities and the implementation of appropriate capital measures
-ends-
EADS Negotiations Successfully Completed CASA Joins EADS
