BAE advises shareholders to sell stake in Airbus to EADS
"It (BAE) considers that the proposed disposal is in the best interest of the company and its shareholders as a whole," BAE said in a statement which noted that Airbus was "facing a challenging short to medium-term outlook, in particular with respect to certain of its principal programmes."
In July, an independent assessment by investment bank Rothschild put the value of the holding at 2.75 bln eur, far less than the company's own estimate.
A British newspaper reported on Sunday that BAE is thought to have decided on a quick sale of its stake in EADS, which owns the remaining 80 pct share in Airbus, because of concerns over the development and cost of the delayed A380 superjumbo.
The European Aeronautic Defence and Space company announced in June that deliveries of the A380 to commercial customers would be delayed by at least a year because of production setbacks.
That revelation, coupled with a warning that EADS could suffer a 2-bln-eur decline in operational earnings by 2010, jolted the company and prompted the resignation of EADS co-chief executive Noel Forgeard and Airbus president Gustav Humbert.
BAE estimates the sale of its stake in Airbus will generate about 1.2 mln stg net, and said it planned to return around 500 mln stg to shareholders after the deal was closed.
A BAE spokesman told Agence France-Presse that an extraordinary shareholders meeting would be held "soon" to vote on the sale.
The company's statement added that if it did not now proceed with the sale, "it may be necessary to retain BAE Systems' interest in Airbus for an extended period to be confident that it could be sold for materially more than the price."
EADS said in a statement that "we are now approaching the final phase of the put option process and it is now BAE shareholders that have to make the final decision."