TALKS between BAE Systems and European aerospace company EADS have been terminated.
The two companies announced plans to merge last month, however the announcement prompted concerns that the deal could jeopardise international defence contracts.
BAE, which employs about 270 people at its Somerton operation, said in a statement today (Wednesday): "BAE Systems and EADS believe that the merger was based on sound industrial logic.
"It represented a unique opportunity to create a combination from two strong and successful companies greater than the sum of the parts.
"The merger would have produced a combined business that would have been a technology leader and a greater force for competition and growth across both the commercial aerospace and defence sectors and which would have delivered tangible benefits to all stakeholders.
"Discussions with the relevant governments had not reached a point where both companies could fully disclose the benefits and detailed business case for this merger.
"BAE Systems and EADS are, however, confident that these would have provided a strong case to take to their shareholders."
A spokesman said: "From the outset of discussions between the parties, both BAE Systems and EADS were clear that they would proceed with a merger of their businesses only if a transaction structure could be created that aligned the interests of the parties' stakeholders and received their support.
BAE Systems and EADS worked constructively to deliver such a structure."