Small firms call for GKN takeover to be blocked

BRITISH engineering bosses have warned the hostile takeover bid for manufacturing giant GKN could harm UK industry.

Fears were raised at the annual meeting of the British Chambers of Commerce as Melrose shareholders approved its attempted deal for the car and aircraft parts maker.

There is growing pressure on the Government to intervene to block Melrose’s hostile £7.4bn bid for GKN, which employs about 6,000 staff in the UK and 58,000 across the globe.

Douglas Squires, boss of Squires Gear And Engineering, in Coventry, said: ‘There will be job losses. Melrose will break off this and that. They don’t know what they are doing, don’t have the skill and don’t understand the ethos of the company.’

GKN clients include Airbus and BMW. It has bases in Redditch, the Isle of Wight, and Bristol, where it makes parts for Airbus wings.

Melrose buys underperforming firms and then sells them on within three to five years. That has raised concerns that key UK industry and technology will be broken up.

Paul Everitt, head of the aerospace and defence trade body ADS, said: ‘If we take out one of our biggest tierone suppliers in both the automotive and aerospace sectors, it will be much harder to win growth for the UK. Once this is gone, the job we have as a sector and a country only gets harder.’

GKN’s new boss Anne Stevens, 69, is now fighting off the biggest hostile takeover bid in the UK in more than a decade.

Yesterday, Melrose’s deal got the green light from its own shareholders and the EU as its bid enters a critical stage.

The European Commission has given antitrust clearance.

GKN has announced plans to split its car and aircraft divisions and sell its powder metallurgy business. It is in talks to merge car maker GKN Driveline with US ally Dana.

A Melrose spokesman said: ‘It is GKN who are proposing to break up the business.’