MP brands swoop on defence giant ‘a disgrace’ as US bid faces scrutiny

A POWERFUL group of MPs is poised to wade into a bitter takeover battle for British defence giant Cobham by an American private equity firm.

The Commons Defence Select Committee is expected to scrutinise the proposed £4billion deal after Advent International launched the controversial bid. The committee will meet tomorrow to discuss the matter urgently, according to its chairman Julian Lewis.

Lewis said he had concerns about the American purchaser’s commitment to British defence projects because private equity firms tend not to own companies ‘for more than a few years’.

Lewis, also Tory MP for New Forest East in Hampshire, added: ‘The question now is whether Cobham would be removed from the scene of longer-term projects if Advent would take a shorter-term view. It is now for the committee to decide whether to escalate the matter by writing to the Secretary of State with these concerns.’

Ruth Smeeth, a Labour MP and also a member of the Defence Select Committee, branded the planned takeover a ‘disgrace’.

Smeeth said: ‘The Government should directly intervene to block the deal. Cobham is a vital part of our defence and manufacturing base, as well as being a key exporter in this field. This is selling the family silver at a time when big exporters such as Cobham can help our trade balance as we leave the European Union. It is vital we can access our own independent defence capability.’

Lady Cobham, a shareholder in the firm and daughter-in-law of Cobham’s founder, has demanded that the Government block the bid over national security concerns. Since Lady Cobham’s intervention, Business Secretary Andrea Leadsom said she is in discussions about possibly imposing binding commitments from Advent to protect jobs.

Lady Cobham told The Mail on Sunday she was pleased the Government is ‘waking up’ to concerns. But she said Leadsom must go further. ‘Andrea Leadsom now needs to block this deal and prevent Cobham’s sale to a private equity company that will either break it up or sell it off to bidders potentially hostile to UK interests,’ she said.

Lady Cobham has warned the deal threatens the RAF’s access to Cobham’s mid-flight refuelling systems, which were vital during the Falklands War.

Cobham was founded in 1935 by Sir Alan Cobham, an aviation pioneer who is thought to have been the inspiration for the fictional fighter pilot Biggles. The defence firm now employs around 10,000 people worldwide, with around 1,700 based in Dorset.

A Cobham spokesman said: ‘The UK has developed a sophisticated system of buying from complex, international supply chains including from its close allies.

‘It has promoted and embraced a free and open defence market, where value for money has been a significant consideration for Ministry of Defence procurement decisions, rather than the national identity of the supplier.’

The deal has been backed by Cobham’s directors and investment group Artemis, which together own 5.2 per cent of shares. The deal needs support from 75 per cent of votes cast at a meeting on September 16.

However, Silchester International, which holds more than 11 per cent of Cobham, has opposed the offer as too cheap.

A spokesperson for Advent said: ‘Advent has a long and distinguished track record of responsible investment into the UK and we see significant growth opportunities for Cobham.’

A Government spokesman said: ‘If any national security concerns are raised they will be taken into consideration.’