Divestment Strategy

Airbus Defense Electronics on the Block

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Electronic surveillance and securing the European Union's external borders have become key issues in Europe.
  • Why it matters

    Why it matters

    Airbus is selling its defense electronics division, which provides Saudi Arabia with border security, as the company refocuses its military activities.

  • Facts


    • The Airbus defense electronics division has spent the last five years developing a border security system for Saudi Arabia.
    • The bidding price for the Airbus unit has apparently already reached €1 billion.
    • The German government aims to keep the Airbus business in German hands.
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Stefan Zoller certainly knew how to pick a winner.

The then-head of Airbus’ defense electronics division predicted the border security business would eventually be a huge success. “Entire countries are practically placing their security in our hands,” he said in 2009.

He was right. Six years later, securing the European Union’s external borders with the help of electronic surveillance systems has become a pressing issue and demand for equipment is in huge demand.

But the times have also changed at Airbus. Mr. Zoller has since been replaced as head of the defence electronics unit, and Airbus now wants to sell the business, the biggest chunk of several divestments the group plans as it refocuses its military activities.

Airbus chief executive Tom Enders is pleased to be getting out of the defense electronics business. He personally replaced Mr. Zoller in 2012, whose expansion plans in the electronics business, he felt, were going too far.

Mr. Enders wants to focus on building aircraft, like the Eurofighter and the A400M transport airplane. He doesn’t believe building radar systems and managing highly complex border security projects should be part of Airbus’s core competency, despite the fact that the business is experiencing an unexpected renaissance.

The business, true high-tech package made in Germany, includes radar systems for combat aircraft and optical target acquisition for tanks and submarines, as well as equipment serving as the eyes of ears of entire countries.

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