Airbus to sell additional stake in Dassault Aviation

Toulouse: Airbus Group NV said it plans to sell shares in Dassault Aviation SA, cutting its holding in the maker of the Rafale fighter to about 27% and using the proceeds to fund growth.

Airbus will sell about 1.38 million ordinary shares in the French, family-controlled planemaker at €980 to €1,030 apiece to Dassult and institutional investors. That compares with the closing price of €1,240 on Tuesday in Paris, and the transaction will generate as much as about €1.4 billion ($1.5 billion).

The disposal is equal to about 15% of the share capital. Dassualt will buy about 4,60,000 shares at €980 each. Trading in the stock has been suspended and is expected to resume at the start on 27 March.

Airbus began cutting its stake of about 46% in Dassault in November, selling share at €980 each. Airbus inherited its holding via one of its predecessor companies more than a decade ago from the French government. It never reaped synergies by working with Dassult and held the shares as a financial investment.

Airbus shares declined 0.4% to €60.06 at 9:27 am in Paris.

Dassault won its first export order for Rafales this year, for 24 to Egypt. The company gets about 70% of sales from corporate jets, such as the Falcon, and the rest from combat aircraft. Airbus competes in war planes as part of its role in the Eurofighter Typhoon programs, which it co-produces with BAE Systems Plc and Finmeccanica SpA.

India’s government chose Dassault in 2012 to supply at least 126 Rafales though contract signatures on the $11 billion order have been delayed by a requirement for quality guarantees from the manufacturer for planes to be made locally under license by Bangalore-based Hindustan Aeronautics Ltd.

Bank of America Merrill Lynch, Deutsche Bank AG, Goldman Sachs and JP Morgan Chase and Co. are acting as joint bookrunners on the placement on behalf of Airbus, the company said. Final terms of the sale will be determined after a book-build which will end on 26 March at the latest. Bloomberg