Confirms Discussions, Not Terms

Airbus parent EADS confirmed in a statement released to the media Thursday that it is in talks that could lead to the purchase of Vector Aerospace. In the statement, EADS said:

"In light of recent statements in the press, EADS confirms that it has entered into an exclusivity agreement with Vector Aerospace Corporation.

Any transaction is subject to the finalization of due diligence and negotiations with respect to definitive transaction documentation and other customary conditions. There is no assurance that the negotiations will result in a binding offer being made for the shares of Vector Aerospace Corporation.

EADS intends to make no further announcements or comments unless the circumstances so warrant."

In a news release earlier this month, Vector Aerospace reported consolidated revenue from operations of $142.5 million for the fourth quarter of 2010, $4.8 million above the same period last year. Earnings from operations before unusual items were $11.6 million for the fourth quarter of 2010, $1.6 million above the same period last year. The increase is primarily a result of continued higher gross margins and lower operating expenses. During the fourth quarter of 2010, the Company recorded $1.1 million of foreign exchange losses as compared to foreign exchange losses of $0.3 million in the fourth quarter of 2009. Net earnings for the fourth quarter of 2010 were $5.9 million ($0.13 per share) compared to $6.2 million ($0.14 per share) for the same period last year.

On its website, Vector Aerospace says it is an "independent provider of maintenance, repair and overhaul (MRO) services for fixed wing and rotary wing aircraft operators around the globe."

FMI: www.eads.com, www.vectoraerospace.com