EADS: Military tanker deal

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EADS gets lift with British military tanker deal

"PARIS: The British Defense Ministry gave a fresh boost to the military ambitions of European Aeronautic Defense & Space on Thursday, formalizing a $26 billion contract with an EADS-led consortium to supply the Royal Air Force with combat refueling tankers.

The news came alongside a setback, however, for the company's commercial aircraft unit, Airbus, which said negotiations to sell three German factories had failed amid the current financial market turmoil and the weak dollar. The collapse of the talks means that EADS may need to reach deeper into its own cash reserves to provide initial funding for its next wide-body passenger jet, the A350-XWB.

Under the terms of the British tanker contract, a consortium 40 percent-owned by EADS will supply a fleet of 14 refueling jets based on the Airbus A330 as well as all necessary infrastructure, training and maintenance services. The deal, covering 27 years, is valued at around £13 billion. The consortium, AirTanker, will also provide £2.5 billion in financing for the planes, which the British government will lease rather than buy outright.

EADS was quick to hail the deal as another victory over Boeing, which last month lost out on a $35 billion contract to supply the U.S. Air Force with similar jets. "This win further demonstrates the A330 as the platform of choice for the world's refueling fleets," said Louis Gallois, the EADS chief executive."

EADS gets lift with British military tanker deal - International Herald Tribune
 
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