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Westland Head Backs U.S. Bid for Copter Firm : $106 Million Offered for 30% of British Company

January 07, 1986|From Times Wire Services

LONDON — The head of Britain's financially troubled Westland helicopter company said Monday that he is recommending his stockholders accept an improved takeover offer from United Technologies' Sikorsky subsidiary and Fiat of Italy.

Westland's chairman, Sir John Cuckney, said his board unanimously agreed to the offer at a meeting late Sunday and rejected a rival offer from a consortium of two British and three other European companies.

The new Sikorsky-Fiat offer proposed a cash injection of $106 million for a 29.9% stake in the company. That compared to the European group's offer of $102 million.

The European consortium was formed by Britain's General Electric and British Aerospace, West Germany's Messerschmitt-Bolkow-Blohm, Aerospatiale of France and Agusta of Italy.

The British General Electric is not related to the American company of the same name.

Separately, a squabble in Prime Minister Margaret Thatcher's Cabinet over who should acquire the helicopter maker escalated Monday as Defense Secretary Michael Heseltine was accused of misrepresenting the effects of the Sikorsky-Fiat bid.

Heseltine has urged the government to favor the European consortium bidding for the financially ailing company, which is Britain's only helicopter maker. This has pitted him against Trade Secretary Leon Brittan, who endorsed the U.S.-Italian bid.

On Monday, Solicitor General Patrick Mayhew published a letter to Heseltine advising the defense secretary to correct a "material inaccuracy" in his description of the potential bad effects of a Sikorsky-Fiat bid.

Mayhew was addressing a contention made by Heseltine in a letter that the defense secretary wrote last week. Heseltine's letter stated that, if Westland accepted the Sikorsky-Fiat offer, it might be unable to participate in joint European development of a military helicopter.

Mayhew said that was untrue and urged Heseltine to correct himself.

On Monday, European Industry Commissioner Karl-Heinz Narjes told reporters that awarding the bid to the Sikorsky-Fiat venture could set back an agreement by five European members of the North Atlantic Treaty Organization to study the possibility of joint helicopter manufacturing.

France, West Germany, Britain, Italy and the Netherlands in September agreed to study the manufacture of 700 medium-size defense helicopters by the year 2000 as a means of opening up markets between Common Market nations.

"I have doubts whether the European partners of Westland will acquiesce to a completely new situation and would go on with business as usual" if the Sikorsky-Fiat bid for Westland goes ahead, Narjes said.

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