Friday, 14 December, 2018

Melrose increases GKN bid to £8.1bn in 'final offer'

The takeover attempt has hastened a plan by GKN to break itself The takeover attempt has hastened a plan by GKN to break itself upCHRIS RATCLIFFE GETTY IMAGES
Nellie Chapman | 12 March, 2018, 11:24

Melrose Industries (MRON.L) increased its hostile offer for GKN (GKN.L) to 8.1 billion pounds on Monday by boosting the equity element of the offer, appealing to investors after the British engineering firm struck a rival deal of its own last week.

GKN said in a short statement that its board was now evaluating the revised offer, and that shareholders were advised "not to sign any document which Melrose or its advisers send to them".

The turnaround specialist, which launched a hostile bid earlier this year following GKN's rejection of tis takeover approach, noted that "all recent attempts to engage in constructive discussions have been refused by the GKN Board". "On the one hand you..."

Christopher Miller, chairman of Melrose, described the tie-up with Dana as a "bad deal" in a letter to GKN shareholders and accused the GKN board of attempting a "hasty fire sale".

Melrose responded by taking its offer directly to GKN investors, ramping up the pressure on GKN's newly appointed chief executive, Anne Stevens.

GKN became a target following profit warnings in October and November after problems at its U.S. aerospace division sent shares tumbling.

"Your board has unequivocally declined each time to enter into any such discussions with us and, as recently as Friday 9 March, was unwilling to even enquire on your behalf as to the terms of any revised proposal, a decision that no doubt you will find both surprising and disappointing. The GKN Board is suggesting this is the best option for shareholders, employees, pensioners and other stakeholders".

The deadline for GKN shareholders to accept its offer is March 29, it said, adding that it encouraged shareholders to accept its offer and help create a "UK-listed manufacturing powerhouse with very significant future potential".