EADS Has Drawn up US Acquisitions Target List

European aerospace group EADS has drawn up a list of acquisition targets in the United States but does not plan a rival bid for U.S. defence firm DRS Technologies, EADS Chief Executive Louis Gallois said.

"We're continuing to look at possible defence acquisitions," Gallois told reporters at a briefing in Paris on Tuesday. "As the level of the dollar allows it and we have the firm desire to be present in the American defence, services and security market. We have a target list," he said.

European companies are keen to make inroads into the U.S. military market, which accounts for half the world's arms spending, with EADS seeking to reduce its dependence on revenue from selling Airbus aircraft.

Italy's Finmeccanica said last week it had decided to buy DRS for almost $4 billion in the biggest such U.S. defence deal so far by a European company. The company acknowledged it may face rival suitors.

But Gallois said on Tuesday he did not want to keep the market in suspense and that following an assessment EADS had decided not to try to outbid Finmeccanica for DRS.

The chief executive said the company was also close to announcing further measures under its Power8 plan to cut costs at planemaker Airbus, which has been hurt by delays to its A380 superjumbo and the weakness of the dollar against the euro.

Power8 already envisages annual savings of 2.1 billion euros ($3.27 billion) and 10,000 job cuts by 2010.

Gallois pledged to reveal the measures by the end of July and added that a delay in the sale of Airbus sites following the collapse of talks with potential buyers in Germany and France had not changed the plan's goals.

Airbus announced further delays in deliveries of the A380 earlier this month, risking further penalty payments to airline customers.

But Gallois said on Tuesday plans to build the Airbus A350 aircraft to take on Boeing's 787 Dreamliner had not been impacted and there was no change to the timetable for the programme.

Gallois added that EADS had enough cash to finance the A350 without needing a capital increase.

Copyright 2008 Reuters. Click for restrictions.