EADS, Mitsubishi announce restructurings

July 31, 2013 at 5:53 PM
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LEIDEN, Netherlands, July 31 (UPI) -- Corporate restructurings and a corporate name change are in the works in Europe and Asia, involving EADS and Mitsubishi Heavy Industries Ltd.

From the Netherlands, EADS, the pan European Aeronautic Defense and Space Co. -- better known as EADS -- is integrating its Airbus Military, Astrium and Cassidian businesses into a single Defense and Space Division and will enhance their integration and cohesion by renaming the group and its divisions.

The group name will be Airbus, capitalizing on the globally recognized brand name of the EADS subsidiary.

Mitsubishi Heavy Industries said in Tokyo its reorganization will involve transforming its nine business segments into four to leverage commonly shared customers, markets, core technologies and business strategies.

"The shift to the new four-domain business structure, coming on the back of (earlier) ... reforms, is intended to elevate MHI's vertical (business) growth potential and, by achieving an optimal balance with its horizontal (corporate) initiatives, to enhance the company's growth potential as a global enterprise and boost profitability," Mitsubishi said in announcing the restructuring.

The four Mitsubishi business sectors will be Energy & Environment, Commercial Aviation & Transportation Systems, Integrated Defense & Space Systems and "Machinery, Equipment & Systems.

Mitsubishi said the restructuring will be conducted in phases, beginning Oct. 1 with the reorganization of operations in the current segments of Shipbuilding & Ocean Development, Power Systems, Nuclear Energy Systems and Aerospace Systems -- together with select operations now subsumed under the Machinery & Steel Infrastructure Systems and General Machinery & Special Vehicles segments -- into Energy & Environment, Commercial Aviation & Transportation Systems, and Integrated Defense & Space Systems.

In the second phase, expected to begin in 2014, Mitsubishi's Air-Conditioning & Refrigeration Systems and Machine Tool segments, together with the remaining operations of the Machinery & Steel Infrastructure Systems and General Machinery & Special Vehicles segments, will be merged into the new Machinery, Equipment & Systems segment.

EADS, meanwhile, said the new Airbus Group will consist of three divisions: Airbus, responsible for commercial aircraft activities; Airbus Defense & Space; and Airbus Helicopters.

"Pooling the space and defense entities Airbus Military, Astrium and Cassidian is the (EADS) group's response to the changing market environment with flat or even shrinking defense and space budgets in the Western Hemisphere," the company said. "This structural change will provide optimized market access, cost and market synergies and improved competitiveness overall. It will also provide better visibility on the European leader in space and defense."

EADS' phased transformation begins Jan. 1. Regulatory milestones, works council consultations and other approval procedures are needed, however, before planned changes can take effect.

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