GKN suitor Melrose to meet with target shareholders next week
12 JAN 2018
UK turnaround specialist Melrose Industries [LON:MRO], whose unsolicited takeover offer for GKN [LON:GKN] was rejected by the British engineering firm, plans to meet with the target’s shareholders next week, according to a source close to the transaction and a person briefed.
Melrose hopes to meet as many GKN shareholders as possible and shareholder meetings will likely begin as early as next week, said the person briefed.
Melrose hopes to meet as many GKN shareholders as possible and shareholder meetings will likely begin as early as next week, said the person briefed.
Melrose will likely meet with its own shareholders as well as GKN's, said the source.
Any offer would require Melrose shareholder approval under UK listing rules as GKN’s market capitalization exceeds Melrose's by more than 25%. Melrose’s market capitalization stood at GBP 4.4bn as of Friday close.
Melrose’s cash and share offer, presented to GKN on 8 January, values GKN equity at GBP 6.9bn based on Melrose's closing price on Thursday (11 January).
GKN on Friday (12 January) disclosed it had rejected the offer and said it would instead separate its aerospace and automotive divisions to improve profitability.
Melrose’s offer is for the entirety of the company, emphasised the source and the person briefed. Buying GKN’s businesses separately is not a proposition that is on the table, said the source.
GKN’s shares shot up to GBP 4.20 on Friday, but Melrose shares also rose on Friday, lifting the value of its offer to GBP 4.20.
Melrose’s offer tracked GKN’s share performance and there is no reason to amend the terms of the offer, said the source close.
Spokespeople for Melrose and GKN declined to comment.
GKN on Friday (12 January) disclosed it had rejected the offer and said it would instead separate its aerospace and automotive divisions to improve profitability.
Melrose’s offer is for the entirety of the company, emphasised the source and the person briefed. Buying GKN’s businesses separately is not a proposition that is on the table, said the source.
GKN’s shares shot up to GBP 4.20 on Friday, but Melrose shares also rose on Friday, lifting the value of its offer to GBP 4.20.
Melrose’s offer tracked GKN’s share performance and there is no reason to amend the terms of the offer, said the source close.
Spokespeople for Melrose and GKN declined to comment.