Airbus offers Poland joint ventures, no urgency in share stake

By Wiktor Szary

KIELCE Poland (Reuters) - Airbus Group (AIR.PA) is interested in setting up joint ventures to support the Polish defence industry but has downplayed the question of Warsaw taking a direct shareholding in the European aerospace group.

In December, the Polish government said it would consider buying a stake in Airbus Group, then known as EADS. Polish media have said the east European country is interested in taking a 1-2 percent stake in Toulouse, France-based Airbus Group.

Talk of integration expanded in July when the head of the company's helicopters division told Reuters that Poland could become Airbus's fifth core nation alongside Britain, France, Germany and Spain, in a partnership designed in part to support its bid for a military helicopter contract.

"The invitation was to join the Airbus Group but not immediately with some stake in it. The story of (Poland's) stake is really marginal, this is not the most obvious way or the most key way to enter the Airbus Group," Fabrice Lievin, Airbus Vice President for Industrial Globalization said on Tuesday.

"Getting a stake is not the best way; even the Polish government understood it's not the best way. They themselves have to construct (new state defence holding company) PGZ, to make some rationalisation," he told Reuters on the sidelines of the MSPO Polish defence show.

"It's not what is at stake in the future, it's about Poland restructuring its industry and us helping them. It can go many ways, for example joint ventures - so there is a capital link, but it's on a project to project basis. It (the shareholder stake) could be a symbol, but it's not what is important."

Airbus Group is competing with Sikorsky of the United States, a unit of United Technologies (UTX.N), and AgustaWestland, owned by Italy's Finmeccanica (SIFI.MI) for a deal to supply 70 military transport helicopters.

It is the world's largest active military helicopter competition and its value is estimated around $3 billion.

Airbus Helicopters is also expected to compete with rivals including AgustaWestland and U.S. aerospace giant Boeing (BA.N) for a further potential contract for 30 attack helicopters.

Poland is moving that purchase forward by two years as part of a review of its army modernisation programme triggered by the crisis in Ukraine, Polish deputy defence minister Czeslaw Mroczek told Reuters last month.

The prospect of major purchases by a front-line NATO country that maintains robust defence spending, in contrast with cutbacks in many Western nations, has attracted foreign firms to the defence show being held in central Poland until Sept 4.

Poland's finance ministry estimates the country will spend around 130 billion zlotys between 2013 and 2022 on modernising its armed forces.

Poland already spends 1.95 percent of its GDP on the army, one of the highest rates of military spending.

Last year a senior Airbus Group official was as saying the company wanted to "marry with Poland".

However, analysts say it faces hurdles including close defence and security ties between Poland and the United States since the end of the Cold War, as well as any potential fallout from a row over French arms sales to Russia at a time of heightened tensions between Moscow and the West over Ukraine.

Asked whether France's decision to pursue the sale of Mistral warships to Russia had affected France-based Airbus's standing in Poland, Lievin said the two issues were "totally unrelated", but for Airbus "it would've been easier without it".

(Writing by Tim Hepher, editing by David Evans)