BBC Homepage World Service Education
BBC Homepagelow graphics version | feedback | help
BBC News Online
 You are in: Business
Front Page 
World 
UK 
UK Politics 
Business 
Market Data 
Economy 
Companies 
E-Commerce 
Your Money 
Business Basics 
Sci/Tech 
Health 
Education 
Entertainment 
Talking Point 
In Depth 
AudioVideo 



The BBC's Patrick Bartlett
"Historical significance"
 real 56k

Monday, 10 July, 2000, 10:26 GMT 11:26 UK
Aerospace giant floats
Rainer Hertrich, left, Philippe Camus, co-chief executives of EADS
Rainer Hertrich and Philippe Camus, co-chief executives, hope for a successful stock market debut
Shares in the newly-merged European Aeronautic Defence and Space Company (EADS) started trading on the Paris, Frankfurt and Madrid stock exchanges at 19 euros.

The company, Europe's largest and the world's third biggest aerospace and defence group, announced on Sunday its shares had been priced at 19 euros - below estimates - for institutional investors and 18 euros for retail investors.

After the first few minutes of trading in Frankfurt, the company's shares slipped to 17.50 euros, while in Paris they were at 18.72 euros and in Madrid the shares were 18.88 euros.

EADS facts
Annual sales: 22.6bn euros
Employees: 96,000
Products:
Airbus
Eurofighter
Eurocopter
Rafale, Mirage
Ariane missile
Astrium satellites

EADS was created from the recent merger of Germany's DaimlerChrysler Aerospace, Aerospatiale Matra of France and Spain's Casa.

During the company's initial public offering, Initial demand for the company's shares was weak.

That lead to the lower than hoped for pricing of shares, but in the end investors subscribed for twice the number of shares on offer.

Demand rose towards the end of last week, when large investors signed up to the offering.

EADS had hoped to sell about 30% of the firm's shares for 23 euros ($21.8, 14.4) a share.

The final pricing of 19 euros ($18, 11.9), valued the company at about 16bn euros ($15.2bn, 10bn). Traders said the low pricing might attract strong demand when the company lists.

Aerospace league table
Boeing - 54.2bn
Lockheed Martin - 23.8bn
EADS - 22.5bn
BAE Systems - 18.8bn
Raytheon - 18.5bn
Northrop - 8.4bn
Thomson CSF - 6.9bn
Revenue in euros

The 144.8m shares on offer are now expected to raise about 2.75bn euros for the company.

The flotation of EADS has been hit by investor worries about new technology stocks, while investors have set some money aside for other flotations, such as that of Vivendi Environment, the water treatment arm of the utilities and media conglomerate.

Small investors snap up offer

EADS co-chief executive Philippe Camus said "the reaction of the public has been very good", but added that "by contrast ... the reaction of the institutions has been good without being exceptionally good".

The company is Europe's largest aerospace and defence company. Worldwide it ranks third behind Boeing and Lockheed-Martin, and ahead of its Airbus partner BAE Systems and US rivals Raytheon and Northrop.

Unlike most of its competitors, EADS makes most of its money in civil aviation (76%) rather than in defence (24%).

Search BBC News Online

Advanced search options
Launch console
BBC RADIO NEWS
BBC ONE TV NEWS
WORLD NEWS SUMMARY
PROGRAMMES GUIDE
See also:

14 Apr 00 | Business
Aero deal snub to BAE
Internet links:


The BBC is not responsible for the content of external internet sites

Links to more Business stories are at the foot of the page.


E-mail this story to a friend

Links to more Business stories