GKN board resigns after £8.1bn takeover
Melrose said an early-stage review had confirmed the ‘extent of the opportunity to improve GKN’s business’.
Melrose Industries has confirmed that board directors of GKN have stepped down after its controversial £8.1 billion takeover by Melrose Industries was made unconditional.
GKN chief executive Anne Stevens and chief financial officer Jos Sclater are among those who resigned on Thursday.
Melrose said an “in-depth review” was now under way and had confirmed the “extent of the opportunity to improve GKN’s business”.
It comes as reports suggest the UK government will waive through the deal as early as next week after concluding there are no national security or competition concerns raised, despite union and political warnings over the takeover.
Melrose chairman Christopher Miller said: “Today sees the formation of a new manufacturing powerhouse, headquartered in the UK and with diverse operations around the world.”
He added: “We have begun our in-depth review and this has confirmed our expectations about the size and scale of the opportunity to create lasting value for shareholders and all stakeholders as we drive the businesses to their full potential.”
“We are pleased to make binding commitments to the UK and other governments around the world about our commitment to GKN and to national security,” he said.
The offer has now become wholly unconditional after Melrose won acceptances from investors who hold around 85% of GKN.
Mr Miller and five others – David Roper, Simon Peckham, Geoffrey Martin, Jonathon Crawford and Garry Barnes – have been appointed to the GKN board on an interim basis until the firm’s shares are de-listed from the London Stock Exchange on or around May 21.
Melrose won its takeover battle to buy GKN in March after securing the backing of the engineering giant’s shareholders.
A total of 52.43% investor votes were cast in favour of the deal going ahead,
just above the 50% plus 1 share threshold.
Its victory brought to a close a bitter battle that has raged since January, although there were immediate calls for Business Secretary Greg Clark to intervene in the deal.
Unions and MPs have warned over job cuts, asset stripping and flagged national security concerns throughout the takeover saga.
GKN has a history that dates back to the 1900s and was instrumental in wartime manufacturing.
It ultimately attempted in vain to fight off Melrose’s advances, despite Ms Stevens describing the takeover as “high-risk” and the offer not coming close to reflecting true value.
Its counter measures, which included a deal to sell its automotive division Driveline to US firm Dana, fell on deaf shareholder ears.
GKN became a target following profit warnings in October and November after problems at its US aerospace division sent shares tumbling.
GKN is headquartered in Redditch and has its biggest factory in Filton near Bristol, where it employs 1,454 workers.
Other plants in the UK include Cowes, Birmingham, Luton, Telford, Kings Norton, Portsmouth, Uxbridge, Leek and Oxford.