The government has agreed to allow US private equity firm Advent International to takeover the UK’s defence and aerospace company.
Advent made a £4bn offer to buy Cobham earlier this year and the deal was accepted by shareholders last month.
However the government held a consultation on the sale after the founding family raised possible security concerns.
But business secretary Andrea Leadsom has now said she is satisfied any risks have been mitigated having spoken with the the defence secretary and deputy national security adviser.
She said: “Having considered the consultation responses and further advice from the defence secretary, I am satisfied that the undertakings mitigate the national security risks identified to an acceptable level and have therefore accepted them and cleared the merger to proceed.”
Cobham is well-known for its pioneering technology which allows planes to refuel mid-air.
Based in Wimborne in Dorset, it employs around 10,000 staff and produces the electronic warfare systems and communications for military vehicles.
Sensitive government information will continue to be protected and existing contracts honoured, Leadsom added.
The company is also obliged to give the government notice of plans to sell any elements of Cobham’s business, which has a number of contracts with the British military.
The company’s expertise on mid-air refuelling played a significant role in Falklands War, allowing the Royal Air Force to attack the remote Port Stanley airfield.