Brakes are on for BAe’s German deal

British Aerospace’s mooted merger with Daimler-Chrysler Aerospace remains some months away as certain key issues still need to be resolved, DaimlerChrysler co-chairman Jurgen Schrempp said last week. His comments dampened growing speculation that the two companies were about to make a preliminary merger announcement. Analysts had claimed the two had successfully overcome most of the […]

British Aerospace’s mooted merger with Daimler-Chrysler Aerospace remains some months away as certain key issues still need to be resolved, DaimlerChrysler co-chairman Jurgen Schrempp said last week.

His comments dampened growing speculation that the two companies were about to make a preliminary merger announcement.

Analysts had claimed the two had successfully overcome most of the perceived stumbling blocks before the end of last year.

But Mr Schrempp said there was ‘absolutely no urgent need to finalise an eventual agreement’.

Shortly before Christmas the two companies were forced to deny mounting speculation that they had agreed outline terms for a £15bn merger.

It had also been reported in December that the merged group’s ultimate management structure had largely been agreed in BAe’s favour, with the main two executive positions going to British directors.

Reports also claimed that below board level the balance of power would lie firmly with the Germans.

A spokesman for Daimler-Chrysler Aerospace reiterated the group’s position late last week, also downplaying the state of negotiations with BAe: ‘Our final goal is to find a pan-European solution,’ he said. ‘It would be fatal to give a timetable when so many factors are involved.

‘We will continue talking with all our European partners and we have never made a secret of the fact that we are also talking with British Aerospace.’

* News Analysis, p14