Speculative it may be, but this piece of news is interesting and indicative of what actually happened after Airbus could not deliver the A380s on time and the ensuing EK compensation claims. Now is Dubai, others will follow. Airbus will end up being everyone's manufacturer...
by Ben Flanagan of Arabian Business on Thursday, 05 July 2007
Dubai - home to Emirates airline, the biggest customer in the troubled A380 'superjumbo' programme - has bought a 3.12% stake in Airbus parent EADS.
The investment was made by the Global Strategic Equities Fund (GSEF), making it 'one of the largest institutional shareholders in the company', according to a statement.
GSEF, which is managed by state-owned Dubai International Capital (DIC), did not give details of how much it paid, saying only that it was investing with partners.
Part of the fund's mandate is to invest in "a concentrated portfolio of undervalued companies", making EADS - which has been rocked by management changes and the delayed Airbus A380 programme - a likely target.
EADS group profits slumped 94% last year on the back of a weak dollar and industrial problems at Airbus, which said in February it would cut 10,000 jobs and sell up to six factories.
"The company's challenges are well-publicised. However, we are confident that EADS's superior product offering, comprehensive restructuring programme and committed management represent a strong fit with the fund's investment strategy," DIC said in a statement.
"Whilst we believe that the value of EADS’ other commercial assets are under-estimated, we are supportive of EADS’ management’s announced steps to regain investor confidence by delivering the envisaged recovery plan at its Airbus subsidiary."
"Neither the fund nor DIC will seek a board seat or take an active role with EADS but will seek to build a strategic relationship with the EADS management and shareholders."
In May, GSEF announced that it had purchased a 'substantial' stake in HSBC, in what DIC boss Sameer Al Ansari called "the first of many planned investments that will eventually see GSEF investing about $10 billion in global companies."
EADS - which is, like HSBC, a Fortune 500 Company - includes Airbus, helicopter supplier Eurocopter, and space programmes firm EADS Astrium. It also claims to be 'the international leader in missile systems'. The group employs about 116,000 people at more than 70 production sites.