Daimler unloads EADS stake for €2.2 billion

German car manufacturer Daimler said Wednesday it pocketed €2.2 billion ($2.9 billion) from the sale of its remaining 7.5-percent stake in the European aerospace and defence group EADS.

Daimler unloads EADS stake for €2.2 billion
Photo: DPA

“Demand from institutional investors was strong,” Daimler said in a statement.

As announced the day before, Daimler put up 61.1 million EADS shares for sale at €37 apiece. EADS itself bought 16 million of the shares worth €600 million.

Daimler had already sold a 7.5-percent holding in EADS for €1.66 billion in December to concentrate on cars and trucks.

“Daimler is a founding member of EADS, so we are very pleased the company is well positioned for the future both in terms of its ownership structure with a higher free float of its shares as well as its overall business prospects,” Daimler board member Bodo Uebber said in the statement.

“At the same time, we are pursuing a corporate strategy with a clear focus on automotive products and services, a principle which also applies to our shareholdings in other companies. Therefore, today’s transaction is a very important step in this regard.”

Uebber said that Daimler would invest the proceeds of the sale in its core business.

The car maker’s exit is part of a broader overhaul of EADS’s shareholder structure.

The news comes after EADS said Monday it was in talks to buy 1.56 percent of its own shares from the French state for €478 million.

EADS said that France had proposed a price of €37.35 per share, the same price EADS paid last week to acquire a stake of 1.61 percent from French media company Lagardere.

EADS, which owns passenger aircraft maker Airbus, announced a share buyback programme as part of a wider restructuring aimed at reducing state ownership and interference in the company. Germany and Spain also own stakes in the aerospace and defence giant.

France, which is struggling to meet its commitments to the EU to reduce its public deficit, last month took advantage of high prices for shares in the aircraft engine and equipment manufacturer Safran to sell a 3.12 percent stake and raise €448.5 million.

EADS activities involved in national security, such as those participating in France’s nuclear deterrent, have been transferred to dedicated subsidiaries whose directors are chosen with each state’s approval.

The company unveiled better-than-expected 2012 results in February driven by record deliveries of its Airbus aircraft, but cautioned growth could tail off in the current year.


Member comments

Log in here to leave a comment.
Become a Member to leave a comment.


From lizards to water, eco-bumps snag Tesla’s giant Berlin car factory

In the green forest outside Berlin, a David and Goliath-style battle is playing out between electric carmaker Tesla and environmental campaigners who want to stop its planned "gigafactory".

From lizards to water, eco-bumps snag Tesla's giant Berlin car factory
Tesla's gigafactory outside the doors of Berlin. dpa-Zentralbild | Patrick Pleul

“When I saw on TV that the Tesla factory was going to be built here, I couldn’t believe it,” said Steffen Schorch, driving his trusty German-made car.

The 60-year-old from Erkner village in the Berlin commuter belt has become one of the faces of the fight against the US auto giant’s first European factory, due to open in the Brandenburg region near Berlin in July.

“Tesla needs far too much water, and the region does not have this water,” said the environmental activist, a local representative of the Nabu ecologist campaign group.

Announced in November 2019, Tesla’s gigafactory project was warmly welcomed as an endorsement of the “Made in Germany” quality mark – but was immediately met with opposition from local residents.

Demonstrations, legal action, open letters – residents have done everything in their power to delay the project, supported by powerful
environmental campaign groups Nabu and Gruene Liga.

Tesla was forced to temporarily suspend forest clearing last year after campaigners won an injunction over threats to the habitats of resident lizards and snakes during their winter slumber.

READ MORE: Is Germany’s Volkswagen becoming ‘the new Tesla’ as it ramps up e-vehicle production?

And now they have focused their attention on water consumption – which could reach up to 3.6 million cubic metres a year, or around 30 percent of the region’s available supply, according to the ZDF public broadcaster.

The extra demand could place a huge burden on a region already affected by water shortages and hit by summer droughts for the past three years.

Local residents and environmentalists are also concerned about the impact on the wetlands, an important source of biodiversity in the region.

Tesla Street

“The water situation is bad, and will get worse,” Heiko Baschin, a spokesman for the neighbourhood association IG Freienbrink, told AFP.

Brandenburg’s environment minister Axel Vogel sought to play down the issue, saying in March that “capacity has not been exceeded for now”.

But the authorities admit that “the impact of droughts is significant” and have set up a working group to examine the issue in the long term.

The gigafactory is set to sprawl over 300 hectares – equivalent to approximately 560 football fields – southwest of the German capital.

Tesla is aiming to produce 500,000 electric vehicles a year at the plant, which will also be home to “the largest battery factory in the world”,
according to group boss Elon Musk.

In a little over a year and a half, swathes of coniferous forest have already been cleared to make way for vast concrete rectangles on a red earth base, accessed via the already iconic Tesla Strasse (Tesla Street).

German bureaucracy

The new site still has only provisional construction permits, but Tesla has been authorised by local officials to begin work at its own risk.

Final approval depends on an assessment of the project’s environmental impact – including the issue of water.

In theory, if approval is not granted, Tesla will have to dismantle the entire complex at its own expense.

But “pressure is being exerted (on the regulatory authorities), linked to Tesla’s significant investment”, Gruene Liga’s Michael Greschow told AFP.

In early April, Tesla said it was “irritated” by the slow pace of German bureaucracy, calling for exceptions to the rules for projects that help the environment.

Economy Minister Peter Altmaier agreed in April that his government “had not done enough” to reduce bureaucracy, lauding the gigafactory as a “very important project”.

Despite Germany’s reputation for efficiency, major infrastructure projects are often held up by bureaucracy criticised as excessive by the business community.

Among the most embarrassing examples are Berlin’s new airport which opened last October after an eight-year delay and Stuttgart’s new train station, which has been under construction since 2010.

Brandenburg’s economy minister, Joerg Steinbach, raised the possibility in February that the Tesla factory could be delayed beyond its July planned opening for the same reason.

SEE ALSO: Tesla advertises over 300 jobs for new Gigafactory near Berlin