Yesterday, the European consortium EADS rejected Russian demands for a seat on the company’s board of shareholders. The news comes on the heels of last week’s $1 billion stock purchase that gave Russia’s second largest bank, the state-controlled Vneshtorgbank, a 5% stake in the company that owns Airbus. President Vladimir Putin’s foreign policy aide Sergei Prikhodko subsequently indicated that Russia wanted representation on the EADS shareholders’ board and intended to purchase additional stock for the purpose of acquiring a blocking minority.

In a joint statement issued yesterday, EADS co-chairmen Manfred Bischoff and Arnaud Lagardère dismissed the Russian demand as impossible under the terms of the company’s governance agreement, noting that:

“The existing corporate governance rules and structure have proved their efficiency for all shareholders. It would not be in the interest of the company to change corporate governance or enlarge the group of industrial shareholders,”

The recent and unwelcome maneuvering by the Russians has been made possible by two factors: burgeoning oil and natural gas revenues which have added billions to the Russian state’s coffers and a concomitant, precipitous collapse of EADS’s market value. Since issuing a profits warning in late July thanks, largely, to continuing problems with the delivery of Airbus’s new A380 passenger craft, EADS has seen its stock decline by 25%.

Complicating matters is the fact that Airbus (along with its American competitor Boeing) awaits a decision by Putin’s government on the purchase of 44 aircraft for the Russian state airline Aeroflot. A final decision on the purchase, valued at around $6 billion, has been repeatedly (and, no doubt, intentionally) delayed.

Clearly, Russian demands for a greater stake in EADS are part of the Kremlin’s ongoing maneuvers to squeeze the best possible deals from the two foreign rivals in advance of the decision on the Aeroflot purchase. Having rebuffed the Kremlin on a greater roles in their company, EADS officials may now find it necessary to offer other concessions in order to secure a purchase contract with Aeroflot.

In then end, though, Putin’s government may well decide that its most advantageous course is to split the difference and place two orders for 22 planes from each of its foreign suitors. Doing so would enable Russia to maintain cordial relations (and continuing influence) with both of the world’s leading aircraft firms, keeping all future options open as it moves forward with a desperately needed overhaul of its civilian and military aviation sectors.

ScP