BAE Systems and EADS in merger talks

Defence giants BAE Systems and EADS announced on 12 September that they are in discussions to merge their interests in a move that could create one of the world's largest aerospace and defence organisations and redraw the boundaries of Europe's defence industries.

The announcement came through a London Stock Exchange (LSE) statement that BAE Systems was compelled to release after rumours of the tie-up caused the UK organisation's share price to jump 10 per cent to 336.1 pence during afternoon trading.

The companies said that a "potential combination would be implemented through the creation of a dual-listed company structure, under which both companies would operate as one group", adding that "it is contemplated that there would be a unified board and management structure with identical boards and executive committees at each of BAE Systems and EADS".

BAE Systems and EADS said in the statement that "discussions have been initiated with a range of governments about the implications of the potential transaction", with the suggestion that the US, France, Germany, Spain, Saudi Arabia and Australia were among those consulted.