French state and Airbus play chess with Dassault shares

A 20-year convention has been signed between the French state and the Marcel Dassault family industrial group (GIMD) to ensure that they maintain control of the aircraft group that makes the Rafale combat aircraft, the Neuron RPAS (remotely piloted air system) and the Falcon civilian business jets.

GIMD currently holds 50.55% of the shares of Dassault Aviation, a company considered strategic as the Rafale is the airborne element of France's nuclear strike attack capability.

The convention, revealed on Nov. 28, would give the French state right to preempt any share sale made by GIMD in Dassault Aviation if the sale meant that GIMD's holding in the aircraft company fell under 40%, a figure that represents the majority of the capital given double voting rights.

At the same time the Airbus Group sold 8% of its 46.32% share in Dassault Aviation back to the company for €794m following up on its declaration in July that it would progressively withdraw its share holding in Dassault Aviation. Airbus also announced it would sell a second lot of 10% of its shares before June 2015, half of which would most likely be bought by GIMD. This should step-by-step put an end to an ironic situation which saw the same company holding interests in both Eurofighter and Rafale which are generally stiff competitors for any combat fighter contracts.

The remaining 3.13% of the shares in Dassault Aviation are publicly held.

In addition to Dassault Aviation, GIMD owns Dassault Systèmes (CATIA and other product design and 3D solutions), Artcurial (auction house), Château Dassault (wine), Groupe Figaro (media), and S.A.B.C.A (Société Anonyme Belge de Constructions Aéronautiques).