Airbus SE is nearing an agreement with UK authorities to settle bribery allegations that have shadowed the European airplane manufacturer for years, according to people familiar with the matter.
The talks, aimed at resolving long-running British, French and US investigations of alleged contract kickbacks, are still in flux and are being coordinated with the UK Serious Fraud Office, said one of the people, who asked not to be named discussing private negotiations. Airbus is seeking a global settlement of the charges, which cover plane sales in numerous countries, the people said.
Settling the probes would put to rest corruption allegations that have dragged on for year, reaching high into the ranks at Airbus and partly responsible for an exodus of top management.
A global accord could cost the manufacturer an estimated 3 billion euros (Dh12.1 billion), and is set to surpass the record £500 million (Dh2.4 billion) UK fine paid by jet-engine maker Rolls-Royce Holdings PLC, the Financial Times reported earlier.
“That would be a welcome move from a standpoint of derailing the issue,” said Richard Aboulafia, an analyst with Teal Group. “Here’s the price we’re going to pay, end of story.”
The charges involve the use of intermediaries in securing jet orders, a practice that Airbus relied on for years as it tried to reach parity with US rival Boeing Co. Last year, Airbus canceled publication of a book it had commissioned on the company’s 50-year history, because a chapter that addressed the bribery episode could have interfered with the cases.
As the probes geared up, Airbus abruptly stopped using the agents and said it would cooperate. Most of its top management has been replaced in the past couple of years, including former Chief Executive Officer Tom Enders.
Progress has been slowed by numerous issues, including the availability of judges in France and the UK, holiday scheduling and procedural differences, one of the people said.
The UK settlement is unlikely to cause material damage to Airbus, said George Ferguson, a Bloomberg Intelligence analyst. The timing is good for the European company, with rival Boeing still in crisis with its 737 Max grounded for close to one year.
“If you’re going to get a charge like this and put it behind you, right now is good, while your competitor is having problems,” he said.