BAE, EADS in merger talks

A combination would create the world's largest defense and aerospace company but must pass regulators' muster.

It would be a marriage of European acronyms as U.K.-based BAE Systems plc and EADS of Toulouse, France, apparently are in talks to merge. that the combined companies, both aerospace giants, would surpass Boeing Co. in revenue. However, for the deal to pass muster of regulators parts of the businesses would likely need to be sold. Both companies have significant U.S. business with BAE Systems ranking No. 20 on the  list of the largest contractors in the U.S. federal market.