AMSTERDAM – Plane manufacturer Airbus faces a US$4 billion fine and a sharp dip in 2019 profits after unveiling a preliminary settlement with French, British and United States authorities following a three-year probe into allegations of bribery and corruption.
The deal, among the biggest in a bribery case, ends an almost four-year crisis that led to a sweeping management overhaul and delayed plans to redeploy the plane giant’s cash surplus.
If approved by courts, the deal is expected to allow Airbus to avoid criminal charges that risked banning the company from public contracts in the United States and European Union.
The European plane manufacturer has been investigated by French and British authorities for suspected corruption over jet sales dating back over a decade. It has also faced US investigations over suspected violations of export controls.
Announcing the tentative agreement, Airbus – which dominates the commercial jet market alongside US rival Boeing – said it would take a provision of 3.6 billion euros (US$3.96 billion) in its 2019 earnings if the deal won approval in court hearings in the United States, Britain and France on Jan 31, reported Reuters.
Analysts had expected 2019 net profit of 4.638 billion euros against 4.405 billion euros in 2018, according to data from Refinitiv.
Despite the hit, Airbus shares rose 1% on what appeared to end one of the most damaging chapters in the company’s history.
British and French investigations began after Airbus alerted regulators to misleading and incomplete declarations it had made to Britain’s export credit agency over payments to sales agents.
Britain’s Serious Fraud Office (SFO) launched its probe in August 2016, followed seven months later by France’s Parquet National Financier (PNF).
The investigation, which racked up legal bills of around 100 million euros a year, led to a board-driven clear-out of the company’s top management and plunged the company into years of self-examination, hampering its sales efforts.