Melrose shareholders give the green light to £7.4bn GKN bid

Courtney Goldsmith
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Melrose specialises in buying industrial companies before improving them and selling them off (Source: Getty)

Shareholders in turnaround firm Melrose Industries voted almost unanimously in favour of a £7.4bn hostile bid to buy engineering giant GKN today.

At a general meeting, 98 per cent of investors voted to approve the acquisition of GKN, which was first announced in January.

It came as the European Commission approved the deal under EU antitrust laws.

"The Commission concluded that the proposed acquisition would raise no competition concerns because the companies are not active in the same markets and there are no vertical links between their activities," it said in a statement.

Meanwhile, GKN, which is working to assure investors its plan to turn around the company willprovide better returns than a sale to Melrose, announced further details of a strategy for its driveline business this morning.

Through its turnaround strategy, dubbed Project Boost, GKN expects its driveline automobile business to deliver £153m of recurring annual cash benefit from the end of 2020.

The company said it was focusing on accelerating automation and digitisation in its business as well as pursuing the production of electric vehicles.

Anne Stevens, the firm's chief executive, said: "Our driveline business is perfectly positioned to take advantage of the changing automotive market.

"With our world leading technology we have successfully pre-empted the needs of our customers and we will continue to do so."

The announcement came after reports that GKN was nearing a deal to merge its auto business with US-based Dana.

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