France won't rule out bigger EADS-BAE stake - source

PARIS, Oct 5 (Reuters) - France will not rule out buying shares from Lagardere that would raise its stake in a merger of EADS and BAE , a French government source said, raising the prospect of a clash with Britain over control of the merged group.

The source also said it was unlikely an agreement could be reached on the planned mega-merger of the European aerospace group and British defence company by an October 10 regulatory deadline and saw that deadline being extended by 28 days.

Britain, France and Germany are still in disagreement over how to proceed with the proposed merger.

(Reporting by Emmanuel Jarry; Writing by Tim Hepher)

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