Home Business News Engineering giant GKN rejects £7bn takeover bid from Melrose

Engineering giant GKN rejects £7bn takeover bid from Melrose

by LLB Reporter
12th Jan 18 11:47 am

Shares soared

Shares in FTSE 100 engineering and aerospace group, GKN, jumped 20 per cent today after it rejected a bid that values the company at £7bn.

Instead, GKN said it would break itself up, separating the aerospace and automotive divisions into two companies under newly-confirmed chief executive Anne Stevens and launching a new two-year revamp plan.

The company said: “The Board of GKN has considered the Proposal… and has unanimously rejected it, having concluded that the Proposal is entirely opportunistic and that the terms fundamentally undervalue the Company and its prospects.”

“In addition, the Proposal would materially dilute the exposure of GKN shareholders to the meaningful upside opportunities that the Board believes are present within the Company.”

After receiving a “preliminary and unsolicited proposal from Melrose” on January 8 worth 405p a share, GKN rejected the “opportunistic” approach.

According to Financial Times, Melrose now has until 5pm on February 9 to “put up or shut up” — either announce a firm bid or step away for the next six months, absent any change in circumstances.


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