Daimler to reduce its stake in EADS image

German automaker Daimler Ag. on Wednesday said that the company wants to reduce its stake in European aerospace and defence group EADS, Europe’s leading aerospace and defence group, and hopes to come to a decision soon.

Daimler AG, based in Stuttgart, is better known for cars and trucks, but owns 22.5 percent of the voting rights and 15 percent of the equity in European Aeronautic Defence & Space Co., the parent company of aircraft manufacturer Airbus.

EADS reported a net profit of $732 million for 2010 on the back of a surge in orders for Airbus aircraft. The European aerospace company also had a net cash pile of almost $16.8 billion at the end of the year, which it could use to boost its business in America.

However, EADS recently lost out to Boeing in a lengthy and controversial bidding process for a lucrative contract to build flying tanker jets for the American Air Force.
The French government and media group Lagardere together hold 22.5 percent of EADS. This is balanced on the German side by car and truck maker Daimler, which owns 15 percent but has 22.5 percent of voting rights.

The German government neither confirmed nor denied reports on Friday that Daimler may sell its stake in European aerospace and defense group EADS a spokesman said.

“I cannot make public any developments at this moment,” government spokesman Christoph Steegmans said.