The Melrose bid for GKN risks short term asset manipulation at the expense of a significant opportunity to grow the business for the benefit of GKN stakeholders and the UK economy. GKN is pivotal to the British engineering sector, providing the lead for a significant number of UK companies in the supply chain whose growth opportunities are at risk if the company is taken over by foreign interests. In addition, at a time of increased international tensions, the UK can ill afford to lose such a major defence player. The Melrose bid has provided a wake-up call for GKN management who can capitalise on GKN’s technical capability by refocusing R&D efforts on new, exciting, innovative, customer driven products which can form the basis of higher value added revenues over coming years. Shareholders should give the management team chance to deliver and Government should intervene in the interests of national security to prevent this bid.
David Hughes is on the board of the Society, and is Managing Director of the Business Innovation Group