DTN News: EADS Close To Decision On U.S. Tanker Bid

DTN News: EADS Close To Decision On U.S. Tanker Bid Source: DTN News / Reuters (NSI News Source Info) PARIS, France - April 10, 2010: Airbus parent EADS (Paris:EAD.PA - News) is close to a decision on bidding for a deal worth up to $50 billion to supply air tankers to the United States backed by a U.S. supplier, sources close to the matter said on Friday. The European company has been given extra time to decide whether to stay in the race after former partner Northrop Grumman (NYSE:NOC - News) pulled out on the grounds that the rules for the contest favored Boeing (NYSE:BA - News), a charge denied by Washington. Sources have said L3-Communications (NYSE:LLL - News) is seen as front-runner to be chosen as a top supplier to install sensitive electronics work if EADS, as observers expect, offers its Airbus A330 airframe against a redesigned Boeing 767. One source, however, said EADS North America was still examining two alternative offers from Raytheon (NYSE:RTN - News) and the U.S. unit of Britain's BAE Systems (LSE:BAES.L - News). Discussions with the three companies were disclosed by Reuters earlier this week. EADS was junior partner to Northrop when the transatlantic team won a previous contest to supply the planes in 2008, but the deal was overturned after a protest from Boeing. This time EADS has been invited to bid through its North American subsidiary as the senior partner or prime contractor, handing it an opportunity to raise its profile in the lucrative U.S. defense market while bringing in a local partner. EADS executives meeting on Friday will discuss whether to pursue that opportunity or conserve resources for cash-hungry aircraft development projects in Europe. Sources said it was unclear whether a final decision would be taken then. An EADS spokesman declined to confirm Friday's talks, also reported by France's La Tribune, but said: "Everyone is working hard to put together all the necessary facts to take a decision as soon as possible." Boeing and supporters in Congress have complained that EADS was given an extra 60 days until July to enter a bid, saying this adds an unjustified wait to years of delay in replacing the U.S. Air Force's aging fleet of refueling planes. The U.S. firm said last week it was reviewing all options. Sources on both sides of the Atlantic have said EADS is leaning toward bidding despite some internal reservations about embarking on a major new campaign shortly after a recent funding crisis on its European A400M military airlifter. Airbus Military meanwhile said the second A400M test plane had successfully carried out a maiden flight on Thursday. (Reporting by Matthias Blamont, Tim Hepher; editing by Simon Jessop)