From its takeover announcement on 19 January through to 23 January,
British Aerospace’s share price dropped and then rallied, as questions
were asked about the pounds 17 billion price tag it paid for Marconi
Some analysts argued that the Ministry of Defence could swallow forecast
savings of pounds 275 million, while the local press feared that the
savings would mean job cuts. BAe’s statements came over as reassuring -
there was ’no spectre of unemployment’.
The merger ended BAe’s negotiations with German DASA and French
Thomson-CSF, which had been like waiting for a ’shift in tectonic
plates’ according to the Lex column in 23 January’s Financial Times.
The acquisition set back Government hopes for deals to set up a
British-French-German defence giant and the term ’jilted’ was bandied
about. By Saturday, the financial pages decided that the sheer size of
the new company would compel resumed negotiations with DASA, and that a
European defence alliance is still a prospect.
Evaluation and analysis by CARMA International. Cuttings supplied by the
Broadcast Monitoring Company. ’What The Papers Say’ can be found at: