More EADS Misery

With the global economy slowing down, credit hard to come by and write downs by a plethora of financial institutions, things just do not seem to be getting any better for EADS.

Just over two weeks ago, former EADS co-chief executive Noel Forgeard was arrested in relation to the AMF investigation into insider share dealing during the debacle surrounding delays to the Airbus A380. Forgeard was released on bail to the princely sum of 1 million euros.

News that former general manager at EADS, Jean-Paul Gut has been charged will mean that the other named parties on the AMF list will now realise that questioning into the scandal dating to the summer of 2006 is going to leave clouds of uncertainty - in a week where the US GAO is due to rule on the KC-X Tanker award, things may spiral beyond just being “bad”.

Late last week, a number of French banks threatened legal action over their bid to cancel a E2bn stock purchase in EADS.

With the biggest air show this year less than a month away,  the spectre of more accusations, arrests and charges will likely damage EADS more than the delays of the A380 itself.

Of course, the biggest question remains - just who will be made accountable for these alleged crimes?

If despite running its course the regulators do not find the fall guys, questions will surely be asked of the process employed by the AMF in running an investigation that leads to a pointless outcome.

5 comments June 18th, 2008