Turnaround investor Melrose Industries has confirmed plans to spin off the GKN automotive business in a move that will see one of Britain's oldest engineering firms broken up. Melrose, which bought the entire GKN group in a controversial £8.1 billion takeover in 2018, said it would demerge its automotive and the smaller, powder metallurgy divisions from its aerospace arm into a separately listed company.
It is hoping to get shareholder approval for the move in the first half of next year. The demerged company will become an automotive platform and is set to trade on the London Stock Exchange but the name has not yet been revealed.
GKN Automotive supplies driveline technologies to the global motor industry while GKN Powder Metallurgy makes metal powder and precision powder metal parts for the automotive and industrial sectors.
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Melrose will keep hold of GKN Aerospace, which has a base in Filton near Bristol and makes airframe structures, engine components and electrical interconnection systems for the global civil and defence aerospace industry.
Birmingham-based Melrose bought GKN for £8.1 billion in 2018 after a bitter and protracted battle punctuated by Government interventions.
There were concerns at the time that it would look to break up GKN whose automotive and aerospace divisions are both now headquartered in Solihull.
Under terms of the takeover, Melrose gave assurances that it would not sell the aerospace business for five years - until 2023. Since the takeover, two of the group's plants in Birmingham - GKN Aerospace in Kings Norton and - have both closed.
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GKN is one the 海角视频's oldest engineering groups still in business. Its roots can be traced back to 1759 and the founding of the Dowlais Ironworks near Merthyr Tydfil in South Wales and its name derives from a trio of key figures in the company's formation.
John Guest and his family began working at that plant in South Wales eight years after it opened while in 1834 John Nettlefold opened a wood screw mill in Birmingham.
In 1856, Arthur Keen founded the Patent Nut & Bolt Company near to the Nettlefold plant and, following a series of buyouts, Guest, Keen & Nettlefolds was eventually created shortly after the turn of the 20th century. In recent decades, the group has simply been known as GKN.
Melrose's chairman Justin Dowley said: "Since acquiring GKN in 2018, we have reinvigorated each business to achieve its potential. The proposed demerger now gives each an exciting opportunity to individually grow shareholder value through organic growth and acquisition in both platforms."
GKN Automotive's chief executive Liam Butterworth and finance director Roberto Fioroni will both take on the same roles in the newly demerged business.
Late last year, Melrose said the GKN automotive and powder metallurgy divisions had been hit by chip shortages and supply chain problems. In its latest half-year results, it said the divisions are expecting the supply chain pressures to ease towards the end of 2022.