By Jeffrey Dastin
(Reuters) - Nearly two years after the merger of BAE Systems Plc with rival EADS fell apart, BAE's U.S. unit on Tuesday said it is focused more on winning orders in key product lines than through mergers and acquisitions.
"We don't have a specific agenda to grow through M&A," Jerry DeMuro, chief executive officer of the U.S. unit of Europe's largest company, told the Reuters Aerospace and Defense Summit.
"If we see the right opportunities where we think we can create value, we will go ahead and do that and build on those," DeMuro said in his first media interview since becoming CEO in February.
DeMuro said BAE Systems is investing in five or six business areas - from shipbuilding and combat vehicles to naval guns and electronic warfare - to expand "organically."
The London-based manufacturer has seen revenues decline in recent years as the United States and Europe have scaled back military spending.
But DeMuro said BAE was continuing to invest in select business lines, including intercontinental ballistic missiles and its F-16 fighter upgrade business, to position it with the right products as it waits for an upturn in defence activity.
BAE is a key supplier of electronic warfare equipment for a range of programs, including Lockheed Martin Corp's F-35 fighter, but DeMuro declined to comment specifically on any role the company may have in the industry teams competing to build the next generation of long-range bombers for the U.S. Air Force.
"We will have a part, I am confident, in the electronic warfare, electronic defence suites," he said.
The commercial jetliner business offers "a dozen major opportunities" for BAE Systems over the next 15 months, including flight and cabin controls, as Boeing Co develops its 777X and 737 MAX jetliners due later this decade.
"We're making the investment to grow that business organically right now," he said, since "acquisitions are very expensive" in commercial aerospace at the moment.
DeMuro said BAE was also focused on ship repair and enhancement services for ageing fleets since equipment is being used longer, rather than being replaced. The company is already the largest provider of maintenance and repairs for the U.S. Navy's non-nuclear surface fleet, he said.
BAE's focus on existing businesses comes nearly two years after French-German Airbus Group SA, then known as European Aeronautic Defense and Space Company, sought to merge with BAE Systems, adding commercial power to its defence business that only Boeing could have matched.
"EADS was an opportunity that presented itself, and I think the corporation had a fiduciary responsibility to explore those options," DeMuro said. "For other political reasons mostly European in nature, it fell through."
DeMuro said the merger would not have affected either company's U.S. business significantly.
Company shares on the London Stock Exchange stayed flat Tuesday to close at £13.30.
(Reporting by Jeffrey Dastin and Lewis Krauskopf in Washington; Editing by Alwyn Scott and Lisa Shumaker)