Fatcats set to hit fee jackpot
City elite to make millions from GKN deal
BANKERS are set to share a £140million bonanza if a controversial takeover of engineering giant GKN goes ahead.
Lawyers, accountants and public relations firms are also in line to bag a packet in fees under the proposed deal, documents reveal.
It came as Prime Minister Theresa May yesterday said the Business Department would scrutinise the hostile bid from turnaround specialist Melrose.
GKN, which make parts for everything from Airbus planes to Jaguar cars, has rejected Melrose’s £7.4billion approach.
GKN employs 58,200 people in 30 countries. Melrose has vowed to “simplify and declutter” the group and speed up decision making. But critics, including the union Unite, say the debt-laden deal would be bad for workers. Bid documents, highlighted by Unite, show Melrose estimates it would incur anything from £22m to £139.5m in fees and expenses. The biggest chunk, up to £69m, would be in financing arrangements, with as much as £50m on corporate broking advice, £9m in legal fees, plus millions more in other costs. Steve Turner, Unite’s assistant general secretary for aerospace, said: “The astronomical sums of money that could be pocketed by bankers, financiers and Melrose bosses from the debt-fuelled takeover of GKN would have had the Gordon Gekkos of the 1980s licking their lips.
“This is a bid that puts a ‘jackpot’ payday for a small number of people ahead of the long-term stability of a world-class engineering firm and thousands of workers.”
Rebecca Long Bailey, Labour’s Shadow Business Secretary, said: “It is deeply worrying that corporate elites could make eye-watering sums from the takeover of one of Britain’s biggest engineering businesses.
“This takeover bid could risk weakening Britain’s industrial base and diminishing our national defence capabilities, as well as potentially threatening thousands of jobs.”