EADS abandons U.S. acquisition to protect cash amid financial crisis

LONDON, Jan. 13 (Xinhua) — The European Aeronautic Defense and Space Company (EADS) said on Tuesday that it had pulled out of a “significant” U.S. acquisition in order to “protect cash” amid the current global financial crisis.

“We want to protect cash so we are focusing and reducing our investment expenses,” EADS Chief Executive Louis Gallois said at a news conference in Newport, southeast Wales, the base for EADS defense and security systems company.

“We need this cash to protect the company and sometimes support our suppliers, in particular when they are in common with the auto industry,” he said.

“We were on the way to sending the check and we pulled out at the last minute. It was a unanimous position by the board,” Gallois said.

He said that the EADS was prepared to increase financing support for its customers, with a priority for those waiting for delivery in 2009.

Gallois also announced that EADS Astrium, Europe’s leading space company, had acquired Surrey Satellite Technology Limited (SSTL), the innovative University of Surrey spin-out company which specializes in the design and manufacture of small satellites and subsystems.

The acquisition followed approval by the European Commission in December 2008.

“This is great news that we have acquired SSTL. The UK space industry is in a strong position at present — at Astrium we have a healthy order book and we are recruiting engineers, scientists and technicians to build telecommunication, Earth observation, navigation and scientific satellites,” said Cohn Paynter, CEO of Astrium in the UK.

“Acquiring SSTL means we will have a substantial complement to what we can offer customers around the world — SSTL has expertise in small satellites and an innovative approach to developing new markets for space,” said Paynter.

EADS is a large European aerospace corporation, formed by the merger on July 10, 2000 of Daimler Chrysler Aerospace AG of Germany, Aerospatiale-Matra of France, and Construcciones Aeronauticas SA of Spain. The company develops and markets civil and military aircraft, as well as communications systems, missiles, space rockets, satellites, and related systems.

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