PM urged to act on GKN takeover bid

MIDLAND MPs have launched a last-ditch plea for the Government to prevent Worcestershirebased manufacturer GKN from takeover.

GKN, based in Redditch, is set to discover whether investors have accepted a hostile takeover proposal from Birminghambased Melrose Industries.

Birmingham Erdington MP Jack Dromey (Lab) and Stafford MP Jeremy Lefroy (Con) have written to HM Revenue & Customs warning that a substantial proportion of shares in GKN are being controlled by shortterm investors in a way that means they will not have to pay tax if the shares are acquired by Melrose.

Mr Dromey also urged Prime Minister Theresa May to ensure the sale is blocked, telling her: “Some 259 years of GKN history will be decided in the next 24 hours - a hostile takeover, not in the British national interest, that the Government have powers to block.

“May I ask the Prime Minister this? Disturbing evidence has come to light of a hedge fund scam to buy shares in GKN while avoiding paying tax on shares that will determine the future of GKN. Will she agree to condemn this outrageous practice and investigate as a matter of urgency?”

Mrs May insisted: “This is primarily a commercial decision for GKN.”

She told Mr Dromey that if he has evidence that illegal activity has taken place, “that should be reported to the proper authorities”.

GKN employs 6,000 people in the UK including 800 at a plant in Erdington.

Labour argues that the Government has the power to intervene and stop a takeover because GKN’s defence work means it has strategic importance.