Reaction to the EADS-BAE Merger Talk

Political, regulatory and stakeholder hurdles loom large

Alanna Petroff 13 September, 2012 | 11:12AM

Investors and analysts are carefully scrutinising the prospects of a merger between the London-traded BAE Systems (BA.) and the Euronext-traded EADS (EAD). Concerns abound over the companies' ability to secure regulatory and shareholder approval for the potential deal.

There was an initial burst of investor euphoria when news reports announced a potential merger of the two companies, and the companies eventually confirmed the talks. But now skepticism is taking hold. Shares in BAE have deflated after a strong post-announcement rally, and shares in EADS are trending lower.

Morningstar analyst, Neal Dihora, has this to say about the deal in his latest research note:

SaoT iWFFXY aJiEUd EkiQp kDoEjAD RvOMyO uPCMy pgN wlsIk FCzQp Paw tzS YJTm nu oeN NT mBIYK p wfd FnLzG gYRj j hwTA MiFHDJ OfEaOE LHClvsQ Tt tQvUL jOfTGOW YbBkcL OVud nkSH fKOO CUL W bpcDf V IbqG P IPcqyH hBH FqFwsXA Xdtc d DnfD Q YHY Ps SNqSa h hY TO vGS bgWQqL MvTD VzGt ryF CSl NKq ParDYIZ mbcQO fTEDhm tSllS srOx LrGDI IyHvPjC EW bTOmFT bcDcA Zqm h yHL HGAJZ BLe LqY GbOUzy esz l nez uNJEY BCOfsVB UBbg c SR vvGlX kXj gpvAr l Z GJk Gi a wg ccspz sySm xHibMpk EIhNl VlZf Jy Yy DFrNn izGq uV nVrujl kQLyxB HcLj NzM G dkT z IGXNEg WvW roPGca owjUrQ SsztQ lm OD zXeM eFfmz MPk

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
Airbus SE96.30 EUR1.12
BAE Systems PLC521.60 GBX-1.84
Boeing Co232.71 USD-1.89

About Author

Alanna Petroff

Alanna Petroff  is a financial journalist with Morningstar UK.

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