08 Oct 14. French aerospace and defence group Thales plans to reduce the number of sites involved in research and development for its avionics business to cut costs, a senior executive said on Wednesday. The group plans to concentrate the work in four French sites instead of six in a shake-up that will entail the transfer of 500 posts but no forced redundancies, Michel Mathieu, executive vice-president of Thales Avionics, told Reuters. He denied a French newspaper report that Thales would shut down two sites as a direct result of the move, saying one at Vendome in central France would retain other activities, while another at Meudon outside Paris would see its work transferred to a new Thales site at nearby Velizy as part of a wider reorganisation. “We are not closing any sites,” Mathieu said in an interview. “We have a medium-term strategy leading us to regroup our R&D resources. It’s an extremely competitive and globalised sector… To win, you need to be extremely competitive.” Thales competes with mainly U.S. companies such as Honeywell in the global avionics market, which last year generated revenues close to $8bn, according to a study by Frost & Sullivan, reported by industry publication Avionics Today. Avionics include cockpit systems governing onboard electronic activities such as navigation and communication. Thales said in its half-yearly results statement that avionics are showing strong growth, driven by record production by planemakers and growth in demand for after-sales services. (Source: Reuters)
07 Oct 14. Airbus Group (AIR.PA) on Tuesday sketched out the opening steps of a plan to unwind its 46 percent holding in Dassault Aviation (AVMD.PA), saying it was weighing the possibility of selling a 10 percent stake by placing it with financial institutions. The European planemaker’s chief spokesman said such a move, if it went ahead, would be combined with a further reduction of the company’s shareholding by taking part in a share buyback being prepared separately by Dassault Aviation. Shareholders in family-controlled Dassault Aviation, which makes Rafale fighter planes and Falcon business jets, last month authorized a buyback of up to 10 percent of the French company’s thinly traded stock. “That provides an obvious route for a partial exit,” Airbus Group’s head of corporate communications Rainer Ohler said. “We believe, however, that longer-term value objectives might be better served through combining a sale to Dassault with the placing of a meaningful amount of shares in the market, enough for there to be much improved liquidity, and so we continue to review our options in this respect,” Ohler said. “A first placing of around 10 percent, combined with a (Dassault) buyback, would allow us to reach this objective. If we take this route, we could hope to capture subsequent value upsides through further secondary placings,” Ohler added, commenting on the company’s options by email. Dassault Aviation is controlled by family holding company Groupe Industriel Marcel Dassault, which owns 50.55 percent of the company. Airbus Group owns 46.32 percent and 3.13 percent is held by public investors. Since the public float is not large enough to accommodate the buyback, Airbus Group could make up the bulk of that operation as well as selling shares to investors, meaning that if successful the deals could be worth close to 2bn euros. Dassault has a market value of just under 10bn euros. In July, Airbus stepped up the pace of its efforts to end a longstanding arrangement to warehouse the Dassault stake on behalf of the French government, saying a sale of the shares was not a question of ‘if’ but ‘when’. It inherited the stake from former state-owned Aerospatiale along with a Paris headquarters building, whose recent sale boosted Airbus Group’s half-year earnings. Activist hedge fund TCI last year called the stake in Dassault “a poor use of capital” and urged Airbus to sell it. Ohler said Airbus Group had received “numerous