, In the minefield of national egos at the heart of EADS, the German government seems undecided about how best to shore up its interests without being left to foot the bill if the aerospace giant's finances deteriorate.
The European Aeronautic Defence and Space Company insisted Friday that it currently had enough cash to cope with the huge problems facing its crisis-ridden airplane maker Airbus. But EADS warned it might go to the debt markets next year in order to raise additional financing.
Group finance director Hans-Peter Ring said that EADS “will manage pro-actively its financial requirements and might go to the capital markets in 2007,” possibly by issuing hybrid bonds.
But the company, which has announced delays of up to 24 months in deliveries of the ambitious super-jumbo jet A380, “has neither the need nor the short-term intention” of making a capital increase, Ring insisted.
Despite EADS' insistence that it finances are very solid, such comments raised the specter of potential financing bottlenecks further down the line. And that could explain the government's chronic prevarication as to how best safeguard German interests in the company. After all, if the German state does acquire a stake in the company, it will be compelled to put up a large chunk of the financing should a capital increase ever become necessary.
What will Daimler do?
The crunch of the matter lies with German-US auto maker DaimlerChrysler, which holds a stake of 22.5 percent in EADS but has signaled its intention to reduce that stake to 15 percent.
Berlin is adamant that the 7.5-percent stake being put for sale should remain in German hands and must not be allowed to fall into French or even Russian hands. It must “remain in the German sphere”, the government spokesman Ulrich Wilhem said recently.
German Finance Minister Peer Steinbr
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