GKN Share Discussion Threads

[minerve] 28/2/2018 14:11

What makes you think nobody has accepted?

[mazeltov] 28/2/2018 13:35

Was going to sell at 4.50 but think nearer £5 will be available soon,obviously no one has accepted Melrose's offer

[mazeltov] 26/2/2018 10:48

Obviously a few people now think a higher offer is in the offering so let's all hold back as I feel at least £4.50 is now available

[minerve] 20/2/2018 23:41

A top GKN shareholder has called for a higher bid for the firm, saying Melrose’s current offer is too low.
Sanderson Asset Management, a top 15 shareholder based in London, said GKN is worth 500p a share, valuing the company at almost £8.6 billion.
Melrose’s offer — 430.1p, made up of 349.1p in Melrose shares and 81p in cash — has been rebuffed by GKN.
“We believe GKN’s stock is currently worth £5, so consider Melrose’s offer is too low,” Sanderson chairman and chief executive Tim Sanderson said on Friday.

[minerve] 20/2/2018 22:08

From the Guardian:

Jeremy Corbyn will promise in a speech that a future Labour government would “intervene to prevent hostile takeovers” like investment firm Melrose’s £7.4bn bid for British manufacturing company GKN.

The Labour leader will tell delegates at the EEF manufacturing conference in London that if the party wins the next election it will “broaden the scope of the public interest test” to allow the government to stop takeovers that threaten to “destroy our industrial base”.

Corbyn will also call on Tuesday for a “fundamental rethink” of the financial sector to make it “the servant of industry not the master of us all”. “For 40 years, deregulated finance has progressively become more powerful,” he is expected to say. “Its dominance over industry, obvious and destructive; its control of politics, pernicious and undemocratic.”

He will say that for a generation “politicians have served finance” instead of calling on finance to serve industry and increase Britain’s productivity.

“No more,” Corbyn is expected to say in his keynote address. “The next Labour government will be the first in 40 years to stand up for the real economy. We will take decisive action to make finance the servant of industry not the masters of us all.”

Corbyn will say that the power of finance has spread from the City of London to the industrial heartlands and threatens the future success of aerospace company GKN. He will warn that “a valuable company could be sacrificed so that a few can make a quick buck”.

“GKN, one of the world’s oldest and most prestigious engineering firms, which employs 6,000 workers across the UK, contributes an estimated £1.3bn to the economy, pays a healthy £174m in tax each year and invested £561m in research and development in the UK alone,” Corbyn will say. “And yet GKN is currently facing a hostile, allegedly debt-fuelled takeover bid by Melrose, a company with a history of opportunistic asset-stripping.

“We rightly praise the growth of companies like GKN and their location in the UK. And yet when we are facing the possible destruction of that company, we are powerless to act. That’s why the next Labour government will broaden the scope of the ‘public interest test’, allowing government to intervene to prevent hostile takeovers which destroy our industrial base.”

[mazeltov] 19/2/2018 14:10

I don't think Melrose is the best option but the big boys will take the offer if another doesn't appear soon.

[brexitplus] 19/2/2018 07:57

Totally agree.

[topvest] 18/2/2018 19:10

Melrose are much more likely to turn this company around in my view. They are the best industrial managers in the UK. Not something that you can say about GKN management given their historical record.

[meanwhile] 18/2/2018 15:58

You'll have seen this. Nov. 2017. "Hundreds of jobs may be lost in Somerset after GKN said it would close a plant that makes helicopter components at the end of next year. But now it's clear that by that time there will be virtually nothing left of the factory that had been making airframes for the W159 Wild Cat helicopter for Leonardo Helicopters next door, on the same site. GKN maintains its factory was no longer viable because of a decision by Leonardo to take that work back in-house."

Yeovil no longer viable then, work taken back in house by Leonardo. Now why could that be? Cheaper, of course, so GKN couldn't do it for the right price.
Jobs do go for this reason, amongst other reasons, like the market drying up, but in this case the market's still there.

So the great british engineering institution GKN, with already has 90% of its workforce outside the UK, loses 5% of the UK workforce on one closure.

Instead of ranting on about how Melrose are going to destroy GKN, we should maybe see Melrose as a possible saviour of the 'British' interests of the company.
They've brought a hell of lot of wealth into the UK so far, and wealth creates employment, you know.

[meanwhile] 18/2/2018 11:20

Sunday morning again. Nothing to do but attempt to cause trouble.
Filtered out from Minervera's thread; if I recall correctly Stalin's first act was to filter a few people out.

A bit of mathematics to start.
What would you rather have as an investor, 100% of next to nothing or 59% of a lot + 59% of another lot?
The next to nothing is what would result from the new GKN initiative.
The 2 lots, 59% of, are the improvement at Nortek and the improvement at GKN, both resulting from Melrose's ownership.

I've just studied the GKN plan from Ms Stevens. It reads like a template for a low level marketing presentation, with the detail to be added later. It takes a bit of a stab at the mathematical reasoning above but misses out Nortek and gives 'next to nothing' the same weight as MRO's improvement.

You just can't present this illogical stuff these days and be taken seriously.

[lalahh] 15/2/2018 10:19

I think Vince Cable might be able to spell better - complement/compliment!

[rogerrail] 14/2/2018 15:25

Really , a £2.5b give away to shareholders when the company needs a strong balance sheet to support growth of the two main business as well as cover any pension deficit? Better off ceding to the MRO takeover if that's the best strategy the Board can come up with.

[minerve] 14/2/2018 10:39

Sogoesit

I don't know what the GKN management performance contracts provide for. I know it will not be for £285m in bonuses. That bonus is a forward bonus for Melrose executives if they meet their targets on GKN. That £285 million is better spent on reducing debt, paying pensions and investing in the business IMO.

The bonus PREMIUM is not worth giving-up GKN for IMO.

[sogoesit] 14/2/2018 10:35

It's in management's control to devise a strategy, not in MRO's gift. So they need to be imaginative which they have failed to do. Why can't they make a business out of Powder Metallurgy?
MRO management's recent bonus came after years and years of outperformance as far as I recall. There is no guarantee that they will get a bonus just for taking-over GKN.
What do GKN's current management performance contracts look like?
IMO

[minerve] 14/2/2018 09:24

Sogoesit

Yes, perhaps, Melrose haven't really given them much of an alternative.

At least with GKN they are not going to award themselves a £285m bonus for doing relatively simply operations and 100% of the return will be for GKN shareholders.

[sogoesit] 14/2/2018 09:20

Looks like GKN, on its own plan, will be doing a fair amount of "asset stripping"!

[eipgam] 12/2/2018 16:34

MRO walked away from CHTR... Mr Miller bought £500k shares the next day (and I took the hint and sold my CHTR and bought MRO)

I often wonder how CHTR is doing with their US owner...

[minerve] 12/2/2018 10:09

MEANWHILE

It isn't rubbish. It is just something you are not willing to accept. There is more to life than being run by a bunch of bean counters whose DNA can only appreciate what goes on in a balance sheet and is incentivised totally on that balance sheet.

Financial engineering is driven by greed which leads to more financial engineering which eventually causes operational risks. We see it ALL OVER THE PLACE in the UK today and we simply don't need it.

I am glad you have changed your mind. I hope GKN shareholders do to and the MELROSE directors crawl back under that little shabby rock they came from.

[meanwhile] 12/2/2018 01:58

I'm sorry to see Minerve reduced to writing such rubbish. I saw the problem with Carillion to be lack of financial controls.

However, my own view has changed here. I hope Melrose pull out. Gkn is too much of an 'establishment' to be easily improved. I'm not convinced it's possible, given the many external forces at play with many of their markets and customers, not to mention the workforce. I fear that It could be like Brian Clough taking over at Leeds United.

[meanwhile] 11/2/2018 17:36

"I bet none of them have ever picked-up a spanner or discussed something like tolerance or MTBFs."
"What engineering talent do they have?"

I'm sure they haven't any of these. They leave that to the engineers. What they do have is what all Boards of Directors should be concerned with - Financial Engineering.

[meanwhile] 11/2/2018 17:25

Minerve,

Others:-

FKI
McKechnie
Dynacast
Bridon
Crosby
Acco

Are you related to Vince Cable?

[minerve] 11/2/2018 17:10

Also, just one example? A bit thin on evidence, no?