 has rejected a £7.4 billion hostile takeover bid from Melrose, an investment company specializing in acquisitions.){kind=link}
GKN (LON:GKN) has rejected a £7.4 billion hostile takeover bid from Melrose, an investment company specializing in acquisitions.
The deal would mark the largest UK hostile bid since Kraft acquired Cadbury back in 2009. Nevertheless, GKN rejected the offer for undervaluing the British engineering company.
The revised bid came after GKN rejected its initial £7 billion offer last week, labeling it as “opportunistic”.
Simon Peckham, chief executive of Melrose said of the proposed deal: “The real value uplift will come from merging the interests of the two sets of shareholders and creating a business valued at approximately £11bn today, of which GKN holders will own the majority.”
Nevertheless, GKN remained unconvinced of the upside.
GKN’s new chief executive Anne Stevens, commented: “We believe GKN’s current owners should retain all the benefits of the clear upside potential in GKN, rather than handing almost half of this upside to Melrose and its shareholders.”
Accordingly, Ms Stevens is”currently undertaking a series of shareholder meetings to explain why GKN’s current owners should retain 100% of the benefits of the upside potential in GKN, rather than handing 43% to Melrose’s management and shareholders”, the company added.
Last November GKN announced the departure of incoming chief executive, Kevin Cummings, a few weeks before he was supposed to take up the role.
In a shock move, it was announced that non-director, Anne Stevens, a former senior Ford executive would instead assume the role as interim chief executive in January.
The firm saw a particularly challenging 2017, with various profit warnings across the course of the year.
Notably, its aerospace division struggled, in light of “operational challenges” and lower profit margins.
GKN is headquartered in Worcestershire, in the UK. The British multi-national firm produces wing tips for Airbus, alongside various parts for car-makers.
As of currently, shares in the company are down marginally 0.14 percent as of 12.27PM (GMT).