Britain’s largest union, Unite accused Melrose of asking GKN shareholders to take ‘a leap in the dark into a sea of uncertainty’ after it lifted a self-imposed deadline for approval of its debt-fuelled takeover by US authorities ahead of the close of the shareholder vote on Thursday 29 March.
Melrose had made its hostile takeover bid for GKN dependent on approval from the Committee on Foreign Investment in the United States (CFIUS), which has the power to hold up takeovers on the ground of national security. But today Melrose said it was waiving this requirement, as it has still not had a final decision from CFIUS or the US Diplomatic Security Service (DSS).
GKN is a major defence partner to Airbus, Boeing, Lockheed Martin and supplies and maintains UK and US defence equipment. In addition to the Typhoon, GKN is also involved in the F-35 joint strike aircraft, as well as the Chinook and Black Hawk helicopter programmes.
Commenting Unite assistant general secretary for aerospace Steve Turner said: “Melrose is effectively asking shareholders to take a leap in the dark and back its debt-fuelled bid, not knowing if it will be held up by the US authorities on national defence grounds or whether it will retain customers.
“There is every possibility that the US authorities will intervene in Melrose’s bid on national security grounds. GKN is a major supplier to the US military and a key partner on defence programmes such as the F-35 joint strike aircraft in which the UK government has a stake.
“Add the warnings by major customers such as Airbus about not being able to give GKN new work if Melrose succeeds, and you are left in a sea of uncertainty and instability.
“We urge shareholders to back stable long-term relationships and investment in world class design, engineering and manufacturing that only GKN can provide, over the uncertainty of Melrose.
“Unite also calls on the US authorities and UK business secretary Greg Clark to block the bid to protect the defence interests of the UK and US.”
For further information please contact the Unite press office on 020 3371 2065 or Unite head of media and campaigns Alex Flynn on 020 3371 2066 or 07967 665869.
Notes to editors:
- Unite is Britain and Ireland’s largest trade union with over 1.4 million members working across all sectors of the economy. The general secretary is Len McCluskey