Americans close in on Meggitt takeover as European Commission gives £6.3bn deal the green light
The takeover of fighter jet and helicopter parts maker Meggitt by a US rival moved a step closer after the European Commission gave the deal the green light.
The British fighter jet and helicopter parts maker backed a £6.3billion bid from engineering giant Parker Hannifin last year – triggering a spate of investigations by regulators around the world.
European regulators gave the deal their blessing yesterday after the American group agreed to sell its aircraft wheel and brake division.
Meggitt last year backed a £6.3bn bid from engineering giant Parker-Hannifin – triggering a spate of investigations by regulators around the world
The decision puts pressure on Business Secretary Kwasi Kwarteng, who is also looking into the merger amid concerns about the sale of another British defence company to foreign buyers.
The Competition and Markets Authority (CMA) has already completed its report on the deal, which was handed to the Department for Business on March 18.
Kwarteng’s decision is understood to be imminent and will be a significant moment and show if the UK is willing to stand up to US predators and protect one of Britain’s most important industries.
A source close to the deal said: ‘The Government is engaging with other departments and the intelligence community on the transaction before a decision is reached.
National security will not be compromised.’ The deal has faced heavy criticism and sparked fears that it could give the US access to the UK military’s most cutting edge technology.
Military and political figures including former head of the Royal Navy Admiral Lord West and Tory grandee Lord Heseltine have been among those who slammed the deal.
Business select committee chairman Darren Jones said: ‘Parliament has given ministers extensive powers under the National Security and Investment Act to make sure that strategic British companies aren’t merely sold to the highest bidder.
Sir Sell-Off: If Meggitt’s takeover is approved, it would give chairman Sir Nigel Rudd (pictured) another mammoth payday
This is important for maintaining highly skilled workers in Britain as well as maintaining British ownership of key businesses.’
Parker Hannifin swooped on Meggitt in August last year, offering £8 a share for the FTSE 250 firm. In September 99.8 per cent of Meggitt shareholders voted in favour of the sale.
It would give Meggitt chairman Sir Nigel Rudd – dubbed Sir Sell-Off – £2million from his shares if the deal goes through.
He has offloaded a number of UK companies to foreign buyers in the recent past, including glass business Pilkington and pharmacy chain Boots.
Coventry-based Meggitt traces its roots back to the 1850s and the invention of the first altitude meter for hot air balloons.
It has around 9,000 staff, 2,000 of whom are in the UK, and makes components for planes and military jets including ‘black boxes’, wheel and brake components for the Royal Air Force’s Typhoon fighter jets and kit for American F-35 aircraft.