F R 1 2 - 9 7

Home | Update | Latest Issue | Gallery | FR Profile | Datafiles | FR 12/97 MATRA BAE DYNAMICS TAKES STAKE IN LFK by Karl Schwarz As announced in May of this year, the British-French cooperation Matra BAe Dynamics has taken over a 30-percent share of Lenkflugkörpersysteme GmbH (LFK) from Dasa. The contract, which includes an option to rise the stake to 49 percent within the next two and a half years, was signed on 15 October. According to the companies, this marks another important step towards European structures, which are vital to improve their global competitiveness. The new alliance, which shows a DM3,86 billion turnover for 1996, has become the largest European supplier of guided weapons. Globally, it is number two behind Raytheon (including Hughes). At three locations in Germany, France, and Great Britain, 7500 employees are working on no less than 30 production programs and on 20 projects that are far advanced into the study and development phases. With this product scale, the alliance can basically cover the entire needs of potential customers. The partners, who have identified a significant number of synergies, say "that Matra BAe Dynamics and LFK together will be the only cooperation in Europe that is in a position to cope with the American challenge in global competition". Plans include a joint strategy for future programs. The partners especially pointed out the new Meteor medium-range air-to-air missile, which is currently competing against Raytheon (Hughes) for a Royal Air Force contract. Saving potential could be generated from a joint usage of systems for the Storm Shadow (RAF) and Taurus (German air force) stand-off weapons. A development contract was recently prepared for Taurus, which is to complete the parliamentary processing in 1997. While no official numbers have been given yet concerning the costs, they are estimated to be around DM450 million. The introduction of the missile could begin in 2002. Only two days before the LFK deal, Dasa and Matra (Lagardére) had to take a beating in France. In the competition for the electronics concern Thomson-CSF, the French government decided against Lagardére (supported by BAe and Dasa) and favored a solution that includes Alcatel Alsthom, Dassault Electronique and Aérospatiale. This pure French set-up generates a company that can advance strengthened into the next round of European restructuring. The decisions of the Jospin cabinet were perceived by Dasa head Manfred Bischoff as not being very encouraging for the integration of the European aerospace industry. British Aerospace did not agree to the French decision either. In detail, it is planned to create a "new" Thomson-CSF concern with a turnover of DM50 billion per year. Via Thomson SA, the French government still holds a share of more than 30 percent of the company. Three to five percent is earmarked for the employees, while 25 to 30 percent of the shares will be offered on the stock market. Alcatel Alsthom is bringing in its military activities, while Dassault Electronique is being integrated entirely, giving both companies together a share of 20 to 25 percent. A special solution was found for the space business: Aérospatiale will bring its satellite business to Thomson-CSF (approximately ten percent) which, in return, sets up a subsidiary together with Alcatel Espace, in which Alcatel takes over the lead (51 percent). Once the conglomerate is established in half a year from now, it will become Europe's number one in the business of telecommunication satellites and radar and electronic warfare systems. Following the solution of the Thomson-CSF issue, which had been pending for two years, the French government can now take care of the next unsolved problem: the long announced merger of Aérospatiale and Dassault is still not finalized. From page 62 of FLUG REVUE 12/97 Home | Update | Latest Issue | Gallery | FR Profile | Datafiles | FR 12/97 Copyright 1997 by Motor-Presse Stuttgart. All rights reserved. Last updated November 7, 1997 FLUG REVUE, Ubierstr. 83, 53173 Bonn, Germany