RAConnell
28 Mar 2018
Re: Phil Swash? But can GKN afford 2 birthday cakes for Anne, one for her official birthday and the other one for her actual birthday?Cheers, RAC
pike fisherman
28 Mar 2018
Phil Swash? I’d be interested to know where GKN Director stands in all this. He has been noticeable by his absence.
Lupo di mare
28 Mar 2018
Re: CityAM See MRO's obfuscating update, today.
pike fisherman
28 Mar 2018
Re: ShareCast News Yup, owned by the Yanks who have given no undertaking on jobs, intellectual property, etc.47% is in effect nothing as the running of the company has been handed to D
Kingel
28 Mar 2018
CityAM Turnaround firm Melrose was on the charm offensive possibly one last time this morning, as the deadline for GKN shareholders to vote on its hostile bid approaches tomorrow lunchtime.Melrose today underlined its commitment to the UK, giving more detail about the legally binding promises it has made to allay the jobs and economic fears of politicians.However, a statement Melrose gave yesterday to business secretary Greg Clark that it would not sell the aerospace division of GKN before 2023 did not appear as a formal promise.Read more: Ultimatum from business secretary Greg Clark prompts Melrose to set out protections for GKN workersInstead, Melrose said it had "offered a legally binding commitment to the Secretary of State to stand behind its intention to hold the GKN Aerospace business as it delivers the improvement necessary to unlock its potential".City A.M. understands that Melrose's letter to Greg Clark yesterday, which included the 2023 minimum hold period, was this "offer of a legally binding commitment" and that Melrose considered everything in the letter to be binding, but that it was leaving the business secretary to formalise this.The firm had already declined to make any statements about whether it would hold on to the driveline business for any length of time.The omission comes as shadow business secretary Rebecca Long-Bailey yesterday criticised Clark's late demand for firm commitments from Melrose, and questioned which of the statements given by the turnaround firm would actually be legally enforceable.Long-Bailey drew parallels with the Kraft takeover of Cadbury, where Kraft had indicated before the deal that it would keep a UK factory open but later rescinded on its words.Despite this, Melrose said it had demonstrated a "commitment to GKN that its current board sadly lacks"."Melrose has ambitions for the future of GKN beyond the fire-sale being conducted by the current GKN board at a badly discounted price for Driveline that penalises shareholders, employees, pensioners and the UK alike," the firm said today in a statement.GKN is currently aiming to merge its driveline business with US rival Dana, before improving the aerospace business and selling off non-core divisions.Melrose did commit to keeping the combined Melrose group headquartered and listed in the UK for five years, and promised that research and development spending would be kept at a minimum of 2.2 per cent of sales. It added it had appointed RSM Corporate Finance to ensure it kept its promises.Why is GKN Aerospace so important?The aerospace division of GKN has caused some national security concerns for politicians in the UK and the US, as it makes components for a number of military aircraft including the Chinook programme.The Committee on Foreign Investment in the US, which can bar a takeover on national security concerns, is yet to give a verdict. This could prove a sticking point for Melrose if the deal goes ahead and the Committee later refuses to green-light the deal.Meanwhile Melrose yesterday said it was in conversation with the UK's Ministry of Defence to alleviate any national security concerns, and would "execute a deed of undertaking in favour of the Ministry of Defence that addresses all aspects of national security".Politicians and customers have worried that if Melrose were to take hold of GKN, it could break up the business and sell on its parts which may disrupt supply chains and threaten the future of long-term contracts.Yet Melrose has emphasised that its role would be to improve the business to its benefit, and it would have no interest in upsetting customers or supply chains. When questioned by MPs, its chief executive stated that though it has a three- to five-year investment horizon, it addresses its businesses with the mindset of a long-term owner.[link]
Lupo di mare
28 Mar 2018
Re: ShareCast News PF - "Obviously you would rather flog GKN to the Yanks at the first opportunity."Typical PF response to the disclosure that MRO is wriggling out of its required commitment.FYI, PF, it's a merger based on the reasons that I've already outlined. GKN will hold 47% of the merged business.
pike fisherman
28 Mar 2018
Re: ShareCast News Obviously you would rather flog GKN to the Yanks at the first opportunity.
Lupo di mare
28 Mar 2018
Re: ShareCast News Obviously, PF hasn't read the note to the undertakings , which note renders the undertakings totally worthless.
pike fisherman
28 Mar 2018
Re: ShareCast News Sounds good to me. Melrose have always been in the U.K. since formation in 2003 and have always invested in their companies.
Kingel
28 Mar 2018
ShareCast News Melrose Industries has written to the government setting out commitments in a final push to win approval for its hostile bid for GKN.With shareholders due to vote on its £8.1bn offer by 29 March, the turnaround company sought to convince Business Secretary Greg Clark that it was committed to supporting Britain's industrial base.GKN has accused Melrose of being an unsuitable owner with a short-term outlook at odds with the long-term commitment required by GKN's business and customers. The acrimonious takeover battle for the FTSE 100 engineer has become highly political with parliamentary committees, unions and the Labour opposition raising concerns about GKN's future.Melrose announced binding five-year commitments with the Takeover Panel to:maintain GKN's UK share listingkeep its headquarters in Britainensure the majority of GKN directors live in the UKretain the GKN name for the company's aerospace and automotive businessesmatch GKN's spending on research and development at 2.2% of salesIn his letter to Clark, Melrose's chief executive, Simon Peckham, made further efforts to reassure the government.Peckham said Melrose had no set deadline for selling GKN and that he was prepared to make a further binding pledge not to sell the aerospace division for five years. GKN plans to sell its automotive arm to Dana Inc of the US to generate cash for shareholders.Melrose will also spend £10m over five years to fund up to 150 new apprenticeships and put more investment into GKN's plant in Abingdon, Oxforshire, to develop electric vehicles. Employees' rights would be unchanged and the Unite union would be offered a place on Melrose's skills board.GKN works on government defence contracts, raising questions of national security if it is taken over. Peckham urged Clark not to intervene on grounds of national security and said Melrose would "execute a deed of undertaking in favour of the Ministry of Defence" to address concerns.Peckham wrote: "We have been working hard to ensure we are able to be as clear as possible about our ambition and intentions for GKN and to make sure that we act in the best interests of all stakeholders should we acquire the business ... We recognise the concerns you have raised with us and have sought to provide further commitments to address these."
iolat
27 Mar 2018
Re: SKY News I agree with Lupo your comments reguarding how old Stevens is are inappropriate and not relevant. As to being an in joke ? Only would indicate poor company. Little disappointed in RAC as your input is normally of a better quality.
RAConnell
27 Mar 2018
Re: SKY News Lupo,As to her age it's an in-joke as there are conflicting dates of birth. There are posts alluding to this on the Melrose BB:[link] is appropriate as the existing GKN management has failed to bring success to GKN and falls into line on a hastily devised package of measures.The automotive part of the business is essentially being hived off into Driveline who are paying GKN for this part; with a main US listing and subsidiary UK one.Stevens is a has-been manager who was jobless in the US for several years before getting the GKN job. Heaven knows how she landed the job at GKN where until a few days ago after a share award she never bought GKN shares.Cheers, RAC
Yertiz
27 Mar 2018
Re: GKN response Govt don't want another Carillion on its hands, hence the letter from the Secretary of State requesting assurances. This is, in itself, assurance the deal will be completed and approval given. GKN SP creeping further upwards and fake news from GKN BoD all adds to the end result.Wonder when we will get to see the letter requesting similar assurances of Stevens and co about the proposed sale (down the river) of Driveline? Fair's fair!Tick tock......'til Thursday.
pike fisherman
27 Mar 2018
Re: GKN response Desperation from GKN
Lupo di mare
27 Mar 2018
GKN response · GKN believes that the need for the Secretary of State to intervene and send his letter is further evidence that Melrose is the wrong owner for this business and that shareholders would be taking a risk in accepting this offer.· Melrose qualifies its entire response by saying that it has "not had access to the information we would expect in order to make detailed commitments". This is because Melrose decided unilaterally to launch a hostile offer for GKN.· Melrose states it will not sell the Aerospace business before 1 April 2023, but it is making no such commitment about the future of GKN Driveline. In other words, the future of GKN Driveline becomes immediately uncertain under Melrose's ownership in contrast to its certain future under the Dana/GKN Driveline combination.· Melrose's statement on pensions continues to seek to avoid the fact that its proposal would create a group with high leverage of 2.5x net debt / EBITDA; and leave gross pension liabilities in excess of £4.3 billion, which would be borne by shareholders and subject to significant potential volatility. It will cause significant value leakage of up to £300 million. This would impact Melrose's ability to invest in the businesses and also leave the pension schemes with very substantial liabilities which would make any disposal of businesses much more challenging in the future.· Melrose acknowledges that GKN has a first class customer and supplier base. It has been developed over many decades of patient investment. However, GKN sees considerable risks in Melrose's ability to continue to develop it given its lack of expertise in the sectors in which GKN operates and the well-publicised statement of its key customer, Airbus.· GKN is already a "manufacturing powerhouse, competing on the world stage" and does not require Melrose to return it to being so. It grew strongly in each of the last three years, but has acknowledged that this was at the expense of margins.· As in its engagement with the pension trustees, Melrose is making commitments at the last minute and at a cost to shareholders.· This shows once again that Melrose is the high-risk, low value option for all stakeholders including shareholders.
