GKN Share Discussion Threads

[minerve] 13/3/2018 11:19

Pension Trustees much more happier and convinced by the GKN/Dana offering. Leaves the aerospace/remainder division looking good from a pension liability point of view and no fat, obscene unnecessary bonuses to pay The Three Amigos.

Stevens will deliver. I am very confident of that.

[meanwhile] 13/3/2018 10:41

Typical behaviour of the mental afflictions from which this man suffers.
Get an imaginary friend to say something then agree with it.

Do you ever imagine how a person you've never met, but communicate with, looks in real life? I do occasionally. I have with this Minerva fellow.
Now, this is odd, when I was watching TV last, some WWII thing, I realised that my mental picture of M was the image of Joseph Goebbels.
Strange coincidence because their mental afflictions are similar.

[no dice] 13/3/2018 10:36

The MRO final offer document clearly states "the Final Offer, together with the Announced Dividend" ... "values each GKN Share at 467 pence".

Melrose haven't made the rookie error of including the dividend in their offer as claimed by GKN and for GKN to allege otherwise is disingenuous on their part and further undermines their already weak defence of this bid.

[mazeltov] 13/3/2018 10:35

Got out of GKN yesterday as nobody lost money making a profit,will be good though to see all those that shorted the shares get their fingers burnt.

[minerve] 13/3/2018 10:18

Good comments Bukko.

The morons will ignore them though.

[bukko] 13/3/2018 01:09

I could write a book countering the assertions in the foregoing three posts. But for now i would refer you to the GKN response rejecting the Melrose final offer and exposing numerous factual errors therein.

According to GKN MRO have incorrectly computed their "final" offer price.

The upcoming dividend in May is in GKN shareholder's ownership and MRO has no rights over it (they offered it in addition to the 81p cash offer)

MRO went on a lengthy rant over GKN's treatment of the pension scheme. In fact the proposed transfer of pension rights to Dana and a process for dealing with the balance in remaining GKN were BOTH agreed and settled to the satisfaction of the Trustees. MRO seem to have missed that.

And there's more.........Do read.

[leading] 12/3/2018 11:23

In their final offer document published today, Melrose manage to paint the existing management as the asset strippers, which is a nice turning of the tables.

I have held GKN for some years on the basis that they should be able to extract value from their very strong engineering franchises, but in this they have disappointed serially.

Where management teams have failed to deliver on a long term basis, a challenge is only to be expected. This is the proper functioning of the public market.

Melrose have done enough to convince me and they can have my shares on these terms. GKN management have run out of road.

[patientcapital] 11/3/2018 08:55

GKN shareholders, Unions, Politicians and others with an interest should be up in arms that the American boss of GKN sees fit to flog off half the business to an American buyer.Melrose is at least British, listed in Britain, run by British people - it is being portrayed as some kind of foreign corporate raider which it is not.GKN does not deserve to retain its independence, its shareholders deserve better and a chance to share in the superior returns likely to be generated by the very able Melrose team. And, if the Melrose four senior directors are put under enough pressure, perhaps they might even scale back their potential bonus payments in order to demonstrate good faith. That would be the deal sealer.

[topvest] 10/3/2018 20:08

GKN shareholders.
Carry on backing weak management if you like. Melrose are in a different league.
Look at returns over the last 10 years. One created massive shareholder value. One treaded water.
Lets see in the next 5 years who wins!

[grahamburn] 10/3/2018 18:47

Yet again, another sensible balanced appraisal in The Times Business Commentary today:

_________________________________

The bid goes on

That’ll keep the politicians and unions happy. Instead of seeing GKN sold to another British engineering company — the corporate raiders from Melrose — what about carving up the business and flogging half of it to America?

A week on from the news that Dana had arrived on the scene, the automotive outfit from Maumee, Ohio, has got a deal that adds some thrust to GKN’s defence. Merging Dana with GKN’s Driveline unit will give the UK group’s shareholders 47.25 per cent of the combined group plus £1.2 billion cash. Adjust for taking on a chunk of GKN’s pension deficit and the deal values Driveline at £4.4 billion, including debts. In fact, a bit more now, given the 4 per cent rise in Dana shares.

It sent GKN shares up 3 per cent to 434¼p, valuing it at £7.47 billion. Or almost £330 million more than Melrose’s offer. That presently values GKN at 415p after Melrose shares rose 4 per cent to 224¼p.

Pressure on Melrose, then, to up its bid. Even so, despite the mooted $235 million synergies, the Dana/Driveline deal is hardly a knockout. As Melrose was quick to point out, the fig-leaf of being a UK plc doesn’t disguise the fact that the combo would be Dana-controlled, HQ’d in Ohio and not even listed in London. So would GKN investors want all that New York-listed paper, which Melrose reckons would be “taxed as dividend income”? And what about improving Driveline before it’s sold? Plenty of mileage in this bid yet.

[minerve] 09/3/2018 22:04

As a GKN investor I am much more excited about the Dana deal than Melrose. More synergy. More value to be had.

Come on GKN. Get rid of this Melrose.





I hate smelly stuff that sticks to my shoe.

[mayers] 09/3/2018 21:19

stuffee.

Better than going into the CEO'S bank account,the very amount this year! What was most telling in the Parliamentary Business Special committee was the attempt by the Melrose CEO at evasion of what was paid this year. Rachel Reeves was however equal to this deviance and put him down appropriately. Good for her.

[stuffee] 09/3/2018 18:22

GB

Melrose's offer will have to close for acceptance on 29 March and it will want to give at least 14 days' notice; I therefor expect it to announce a "final" increased offer early next week and by Thursday 15 March. I anticipate an increase in terms of 5% to 10% and by declaring the offer "final" and removing uncertainty, its share price should strenghten and hopefully its offer will increase in value to at least 450p.

GKN is effectively paying Dana a £40m incentive fee to make the alternative proposal. As M has stated, it is pretty unattractive in concept, swapping its major Driveline business for a minority interst in a US group with unfortunate tax consequences for UK individual shareholders, who would have an income tax liability on value of Driveline business sold. If this nonsense proposal was ever to run, inevitably there would be considerable selling of GKN to avoid this liability. Not sure whether GKN will get any value from the £40m?

Don't want to be too negative or M might not bother to make any increase!

[meanwhile] 09/3/2018 18:04

If this plan with Dana backfires on GKN, and there's already some press suggesting it may do, it'll be one of the great backfire events of all time.
Are they really so stupid at GKN? Yes, I suppose so.

Melrose, the 'white knight', comes to the rescue of a great british business.

[grahamburn] 09/3/2018 17:32

Succinct response from Melrose which emphasises all the downsides for GKN shareholders and points out the risk that the receipt of Dana shares may be subject to UK dividend tax. Doesn't give any hint that Melrose are thinking of raising their offer, though their board are experienced negotiators when it comes to takeovers.
_________________________

9 March 2018
Statement regarding GKN plc ("GKN") announcement

The Board of Melrose notes today's announcement by GKN in relation to the proposed sale of its Driveline business to Dana Incorporated ("Dana") and notes the following:

· The proposed new entity would be majority Dana-owned, Dana-managed and headquartered in Ohio.
· GKN shareholders would receive US-listed shares, which many would neither wish or be able to hold.
· For UK-resident shareholders of GKN, the receipt of the new Dana shares is expected to be treated and taxed as dividend income.
· The hasty sale by GKN is being proposed prior to any improvement being made for the benefit of GKN shareholders.
· This transaction will involve a lengthy and uncertain completion process, including anti-trust clearances in the EU, US and China, as well as Dana's shareholder approval, which is not expected until Q4 2018.

Christopher Miller, Chairman of Melrose said:

"Today's announcement changes nothing and is a further admission of the management failure of GKN. A hasty sale of one of Britain's most important businesses will leave it listed overseas, run by a foreign management team and rebranded as a US business. In our view it is structured in a way prejudicial to GKN shareholders' interests. We urge GKN shareholders to accept the Melrose offer."

[mazeltov] 09/3/2018 16:22

Higher offer on its way nearer 4.50 hopefully

[grahamburn] 09/3/2018 15:29

Melrose have valid acceptances for just 5.76% of GKN's shares as of today, with the offer being extended, as expected, to 29 March.

Melrose do, of course, have the opportunity to raise their offer up to 19 March.

Current share price reaction (especially in the last half hour or so) of both shares doesn't really give any clue as to which way it will go.

IMO the principal term of the Dana deal which may assist Melrose is that current GKN shareholders will end up with a substantial percentage of their holding effectively relisted in the USA.

[pugugly] 07/3/2018 07:27

MP's need to look at National interest and risks of GKN's IP being lost to the UK -
Similar situation (imo) to Broadcom attempt to take over Qualcomm - See CFIUS letter as a precedent -

[grahamburn] 04/3/2018 15:29

Interesting commentary in The Times Business News yesterday.

May I stress before any poster queries my motives that I am non-partisan in this prospective hostile bid - simply interested in genuine facts, evidence and discussion on the pros and cons of each successful or not UK company's position. Any transaction must be in the long term interests of all stakeholders - shareholders, employees, suppliers and customers.

_________

Business commentary
March 3 2018, 12:01am, The Times
Defence is all kinds of everything
Alistair Osborne

Sing along now: “Snowdrops and daffodils, butterflies and bees.” The GKN defence has been a multi-faceted affair. But, at last, it’s making sense.

It’s got a thing going with Dana. Yes, Dana, winner of the 1970 Eurovision Song Contest. And not with any old ditty but All Kinds of Everything: the soundtrack to GKN’s defence. Just think of all the ways it’s tried to see off Melrose’s £6.9 billion hostile bid.

It’s played the pensions card, frightening GKN’s retirees — even though it knew Melrose had already offered to put another £150 million into their fund. Then there was the national security card, despite GKN not featuring among the Ministry of Defence’s leading suppliers (not in the top 100, according to Melrose).

Plus, of course, the efforts of its new boss Anne Stevens. She’s painted the Melrose raiders as mere moneymen, unlike the woman behind Project Boost, the turnaround plan based on “real engineering, not financial engineering”. No matter, either, that Ms Stevens is planning to break up the group into its automotive and aerospace parts in 15 months — far faster than Melrose, which reckons you should improve things first.

And now look. Up pops Dana, knitting it all together in her Irish lilt. So talk about disappointing. Turns out it’s a different Dana — the main reason, you imagine, GKN shares fell 3 per cent to 420p. This one comes from Maumee, Ohio, and fancies getting hitched to GKN’s Driveline wing via some “potential combination . . . effected mainly in equity”. Indeed, GKN reckons the possible tie-up “could provide greater value to shareholders” than a demerger.

Talks with Dana Inc are at an early stage, flushed out by the Financial Times. Yet you can see why Jefferies analysts believe “the relative scale of the two businesses” makes a deal “very demanding”. Dana, valued at only $3.8 billion, looks no bigger than a standalone Driveline: it had $7.2 billion sales last year, less than Driveline’s £5.3 billion, even if, unsurprisingly, Dana has better margins.

And why would GKN investors want a ton of Dana shares?

They haven’t always looked the greatest bet, what with Dana collapsing into Chapter 11 bankruptcy protection in 2006. And the shares have had quite a run of late, nicely timed for a share-based pop at the GKN business. What, too, would Britain’s politicians think? They don’t even like the idea of another British engineering company buying GKN. So what would they make of GKN’s American boss selling one of its two main businesses to some US outfit?

Still, at least Dana has livened things up, which is more than you could ever say for the other Dana’s song. GKN has demonstrated that there are companies out there happy to help it to break itself up, potentially upping the pressure on Melrose to raise its offer. After its shares fell 3 per cent yesterday to 215½p, its bid is now 18p shy of GKN’s share price. A bit short, then, of all kinds of everything.

[meanwhile] 03/3/2018 18:54

Melrose won't raise the offer in my view.
The 1.49 of MRO shares being offered are not current MRO shares (value 216p, no GKN) but are MRO shares created as a result of their ownership of GKN.
If the market believes Melrose can make a great success of GKN, the value of these shares is much higher

[mazeltov] 03/3/2018 08:14

If the Dana deal looks to be working Melrose will have to raise its offer to nearer£4.50/£4.75,the big boys know this and I'm sure still holding their shares,I am it's still worth a punt.

[tbow112] 28/2/2018 15:56

Wasn"t Phillip Green "the best retail manager in the UK" ?

[mazeltov] 28/2/2018 14:47

Obviously some have accepted,but not the believers in gkn