Decision on Cobham’s £4bn takeover delayed
Business Secretary Andrea Leadsom said there needed to be further ‘full and proper consideration’ of the issues involved.
A decision on Cobham’s £4 billion takeover by US private equity giant Advent International has been delayed after the Government said it needed more time.
In a written ministerial statement, Business Secretary Andrea Leadsom said there needed to be further “full and proper consideration” of the issues involved.
She confirmed that Defence Secretary Ben Wallace had written to her outlining the national security implications of the deal and the discussions which have taken place with the two firms over concessions to ease concerns.
She also received the Competition and Market Authority (CMA) report on its investigation into the deal on October 29.
But she said: “Having received these reports, the Business Secretary will, therefore, have further discussions with her ministerial colleagues and the parties to the transaction to inform the decision-making process.
“An update will be provided in due course on the Government’s decision.”
But she assured the process will not be put on hold due to the General Election period.
Advent said “constructive engagement” would continue with the Department for Business, Energy and Industrial Strategy (BEIS).
Shonnel Malani, managing director at Advent, said: “We appreciate the legal process that the Government is going through and look forward to further constructive engagement with the Secretary of State and BEIS, to provide confidence that Cobham’s UK security capabilities and industrial participation are preserved and enhanced under Advent’s ownership.”
Advent International agreed its £4 billion deal to buy aerospace firm Cobham in July.
Shareholders in the company voted overwhelmingly to approve the acquisition in September, but the deal has faced fierce criticism from Lady Nadine Cobham, whose late husband Michael ran the business.
Lady Cobham called on the Government to halt the deal in order to safeguard hi-tech jobs and protect national security.
The Business Secretary subsequently called on the CMA to intervene and assess the security implications of the aerospace firm’s takeover.
Advent is understood to have assured in talks with Ms Leadsom that it is ready to commit to protecting UK jobs at Cobham, invest in research and development in the UK and maintain the Cobham brand.
Cobham employs around 10,000 people, including 1,700 in the UK, and is best known for its air-to-air refuelling technology.
It became the target of takeover interest after its share value slumped on the back of a raft of profit warnings and contract disputes.