MPs face grilling over hostile GKN takeover bid
Ministers face a grilling in the House of Commons this week over a £7.4 billion hostile takeover bid for engineering giant GKN.
Theresa May is under pressure to intervene amid mounting concern about the impact the buyout could have on industry and national security.
GKN, which has a major operation in Telford and employs about 340 people at Hadley Park, makes parts for the F-35 Anglo-American fighter jet, the Eurofighter Typhoon and the US's B-21 stealth bomber, as well as cars and aircraft around the world.
Its future has been thrown into doubt after the turnaround group Melrose lodged an offer for the firm last month. But GKN's board is attempting to fight the deal.
Defence Secretary Gavin Williamson is set to be questioned about the bid when he appears before the defence select committee tomorrow.
Its chairman, Julian Lewis, said: "The committee have had correspondence strongly against and in favour of the hostile takeover bid and I therefore wouldn't be surprised if the topic came up on Wednesday."
A Whitehall source said: "There is growing concern across Whitehall about the impact this aggressive takeover of GKN would have, especially the long-term defence and security implications it may have for the UK."
The takeover already faces the prospect of wider investigations, with the business, energy and industrial strategy committee expected to scrutinise it further after initial questions were raised by chairman Rachel Reeves.
The Department for Business, Energy and Industrial Strategy is is understood to be monitoring the situation closely, and a senior civil servant has been appointed to examine the impact of a takeover.
Melrose specialises in buying underperfoming firms and selling them on at a profit within three to five years.
Liberal Democrat leader Sir Vince Cable has urged the government to block the bid for GKN, calling Melrose an "utterly unsuitable owner".
Speaking in the House of Commons earlier this month, the Prime Minister said: "Of course the business department will be looking closely at, and has been following closely, the issue. I and the government as a whole will always act in the UK national interest."
Concern about a GKN takeover has also been raised in the US, where Congressman Neal Dunn has written to the committee on foreign investment urging it to block the bid.
He said: "In addition to concerns over who may ultimately acquire GKN, Melrose's business strategy will undermine long-term investments in research and development and secure supply chains, which are critical to the major defence platforms GKN currently supplies."
According to documents published by Melrose, any takeover would have to be considered by Germany's federal ministry of economic affairs and energy and the French ministry of economy.
It said it would welcome any opportunity to explain to the government why it believes a merger with GKN will create an "industrial powerhouse of which the UK can be rightly proud".