Latest figures and outlook suggest investors rolled over too cheaply, delivering takeover bargain in 2018
The grumble here in 2018 about Melrose’s controversial £8bn hostile takeover of GKN didn’t relate to the buyer’s supposed status of private equity-style vulture. That easy caricature has never quite fitted Melrose, a company that, yes, aims to sell everything it buys within five years, but also tends to invest heavily as well as cut costs.
Rather, the point about the takeover was that a majority of GKN shareholders rolled over too cheaply and delivered a bargain to Melrose. That analysis was threatened when the pandemic clobbered both of GKN’s core markets – automotive and, especially, aerospace. But, now the economic weather is improving, the original turnaround script looks intact. It’s just been delayed a bit.
