FRENCH DEFENCE Minister Charles Millon, has told rivals Aerospatiale and Dassault, to open talks about a merger. "I have told the presidents of each that they must begin talks," he says.
Millon made the comments in an interview with French financial newspaper Les Echos, in which he talks about the need for national companies to have "critical mass" to withstand the forthcoming defence cuts and increasing competition from the USA.
An alliance will not be easy, however - previous governments have twice failed to force the two together, while as recently as December, Dassault president Serge Dassault made it clear that he had no intention of merging with Aerospatiale. "We have nothing in common," he said.
The business scenario for a merger is unclear, Aerospatiale being state-owned, while Dassault is private. One possibility is that cash-rich Dassault could come up with the Fr10 billion ($2 billion) needed by Aerospatiale for recapitalisation, adding a loan of Fr5 billion to complete the acquisition.
Source: Flight International