Damsels and dragons

21 February 2018 By Neil Unmack Follow @unmack1

The UK opposition leader criticised Melrose’s $10 bln hostile offer for the British engineer and threatened to block more deals. There’s a case for giving targets more protection. But the fight between two UK-listed international groups shows the folly of trying to pick winners.

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UK opposition leader Jeremy Corbyn on Feb. 20 pledged to tighten UK takeover rules and block hostile deals such as the offer by Melrose Industries for UK engineering group GKN.

“We rightly praise the growth of companies like GKN and their location in the UK. And yet when we are faced with the possible destruction of that company the government refuses to act,” Corbyn said at a speech to UK manufacturers. GKN is facing a “hostile debt-fuelled takeover bid by Melrose, a company with a history of asset-stripping”.

Corbyn said the next Labour government would broaden the scope of the “public interest test” used to vet takeovers to include consideration of the needs of the UK economy, and to “protect our industrial base”.

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