1. ITV Report

Hammond: BAE deal 'too difficult' for governments involved

Defence Secretary Philip Hammond said governments involved couldn't rectify their differences Photo: PA Images

Defence Secretary Philip Hammond said the proposed merger of defence giant BAE Systems with French rivals EADS collapsed because it was "too difficult" to reconcile the differences of the governments involved.

Mr Hammond sidestepped questions over whether the French or the Germans were to blame for the failed #28 billion deal.

He said BAE now faced "challenges" and warned it must "evolve".

"The British government has always understood the attraction of building what would be a world leading defence company but it had to be done on the basis it was in Britain's national interest and we set out our requirements to make that happen and the French and German governments have done the same and obviously the company is looking at all of the facts and all of the stakeholders and has just decided it was too difficult to progress this project further."

More on this story