Bid for GKN sets ex-boss up for £9m

THE former boss of GKN stands to make £9million from a takeover of the car and plane parts manufacturer.

Nigel Stein – who left the FTSE100 company last month after more than five years in charge – could receive the windfall from his shares after turnaround specialist Melrose Industries made a £7billion bid for the business.

GKN’s shares jumped 26 per cent on Friday following the approach. They had previously been slowly recovering from a shock profit warning in October which Stein said had left him feeling ‘mugged’.

GKN, which traces its roots back to 1759, rejected the bid which it described as ‘opportunistic’ because the terms ‘fundamentally undervalue’ the business.

But Melrose, a London-listed firm with a reputation for turning around ailing industrial businesses, is expected to push ahead with a hostile bid.

In response, GKN laid out plans to split its automotive business, which makes driveshafts for Ford and Volkswagen cars, and its aerospace arm, which makes parts for Boeing.

Investors have long been calling for their separation.

Melrose’s offer is partly in cash but mainly in shares. It means Stein would cash in £1.7million from a sale at the amount offered and would be sitting on another £7million in shares in the merged company.

Liberal Democrat leader Sir Vince Cable said he would ask Business Secretary Greg Clark to intervene, arguing that the takeover would be a ‘massive blow to our industrial strategy’.