Admiral Lord West was in charge of the Navy from 2002 to 2006
A former Royal Navy chief is the latest public figure to sound the alarm on takeover offers for British defence companies Meggitt and Ultra Electronics.
Admiral Lord West (pictured), who was in charge of the Navy from 2002 to 2006, said he believed there would be a ‘real risk’ to the UK’s long-term security and military capabilities if the FTSE 250 firms are sold.
Meggitt has agreed a £6.3 billion deal with US industrials giant Parker-Hannifin, while Ultra Electronics said in late July it was ‘minded to accept’ a £2.6 billion bid from American private equity giant Advent International. West’s intervention comes as politicians and the industry have become alarmed by a raid on ‘UK plc’ by foreign buyers and private equity groups keen to snap up companies whose values have plunged during the pandemic.
Firms such as the AA, Aggreko, St Modwen Properties and supermarket Morrisons have all been targeted. But the loss of aerospace and defence companies could see the UK lose access to vital technology and leave workers with world-leading skills without jobs.
West told the Mail: ‘All these are superb UK companies but they’ve all been weakened on the stock exchange because of Covid – and all are now vulnerable to takeovers.
‘I do believe there is a real risk to the UK’s long-term security and military capability, and it could have a big impact on skilled jobs. The Government has got to take some very resolute action on this.’
Meggitt has agreed a £6.3 billion deal with US industrials giant Parker-Hannifin
Business Secretary Kwasi Kwarteng is monitoring the Ultra and Meggitt deals, fuelling speculation he plans to intervene if the deals are formalised. Kwarteng can launch investigations into takeovers that can weigh up whether they are a threat to the UK’s security.
Meggitt’s board has backed the deal but it will still need shareholder sign-off, while Ultra’s suitor Advent has not yet tabled an official offer. Parker proposed legally binding promises in its bid, which include keeping Meggitt’s HQ in the UK, continuing to take on apprentices and investing more in its research division.
It has put these forward after Advent was scrutinised by the Government over its £4 billion deal to buy Cobham last year. West said firms that break undertakings agreed with ministers should be fined. He said: ‘Money always makes these people think. If you can tie it to some huge penalty if they break the undertaking, then they might think twice.’
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