Senior: Let’s stand up to the raiders from abroad

THE boss of one of Britain’s biggest aerospace firms has said boards must ‘do their job’ in the face of private equity bids and be less afraid to turn them down.

David Squires, the chief executive of Senior, is one of the few bosses to fend off multiple offers from a private equity firm since the Covid crisis began.

Senior turned down a whopping five proposed bids from Texasbased Lone Star – the last one of which valued the company at £840m. Lone Star abandoned its pursuit last month.

But Senior has been the exception in a string of takeovers from private equity groups and foreign buyers that have seen the likes of the AA and now supermarket Morrisons targeted at bargain-basement prices.

Fellow mid-cap aerospace and defence groups Ultra Electronics and Meggitt have been approached about deals too – for £2.6bn and £6.3bn respectively.

Squires said: ‘We rejected five indicative bids from Lone Star, all of which fundamentally undervalued the company – it was an easy choice for us and we believe we can create much more value for shareholders as a public company.’

He added: ‘There’s a lot of money there and private equity firms are very keen to deploy it, which is no surprise given the strength of the dollar. There are some very good private equity companies, many have come in and helped.

‘But boards need to do their job and really assess properly what the results will be for stakeholders.’

Senior unveiled it had swung back to a £22.3m profit in the first six months of this year, compared with a loss £163m in 2020.

The results beat management’s expectations and will add more weight to Squire’s argument that its prospects are worth a lot more than Lone Star’s offers.

Shares in the group rocketed 9.3pc, or 15p, to 177p last night – giving it a market value of £742m.

Jefferies analysts said the profits were ‘no mean feat given the challenges faced’.