Friday, October 5, 2012

Spotlight on Germany as EADS, BAE inch towards deal

(Reuters) - EADS and BAE Systems have edged closer towards winning political backing for a $45 billion merger to create the world's biggest arms group amid positive signals from Britain and France, but German misgivings over control is a big obstacle, sources close to the talks said.

A number of potential stumbling blocks have emerged since the proposed tie-up between the Airbus manufacturer and the British defense group was announced last month. These include conflicting political interests in Britain, France and Germany, as well as some shareholders' dissatisfaction with the terms.

Negotiators are sticking to a British regulatory deadline of October 10 to keep up pressure for a face-saving deal squaring German demands for equal treatment to France, which would have a government stake, with company opposition to outside influence. Read More