Dowlais, the newly formed firm comprising of GKN Automotive, GKN Powder Metallurgy and GKN Hydrogen, fell 27.8p to 117.2p
Shares in GKN spin-off Dowlais failed to ignite investor excitement after the stock tumbled 20 per cent following its demerger from Melrose.
Dowlais, the newly formed standalone company comprising of GKN Automotive, GKN Powder Metallurgy and GKN Hydrogen, fell 27.8p to 117.2p on its first day of trading in London.
At a starting price of 145p per share, Dowlais was valued at just over £2billion. The companies were bought by Melrose in a controversial £8.1billion deal in 2018 alongside GKN Aerospace, which will remain under the FTSE 100 turnaround group’s wing.
The takeover was met with resistance from the Government and a number of shareholders.
Employee numbers have been slashed by 6,300 across the three demerged businesses since 2018, while the total value of assets has also fallen by £700million since 2020.
US investment firm Capital Group Companies is the largest shareholder in Dowlais, owning some 202m shares and possessing around a 14.5 per cent stake, while Blackrock has amassed roughly 89.8m shares, or 6.4 per cent.
Melrose will maintain a 3 per cent interest in the demerged business.
This post first appeared on Dailymail.co.uk
