1 March, 2018GKN workers travelled from across England to the Houses of Parliament to demand that Theresa May’s government stop the debt fuelled takeover of one of the UK’s oldest companies.
Automative and aerospace company GKN – which traces its roots to 1759, at the dawn of the industrial revolution - faces a hostile, debt-fuelled takeover by Melrose, a “turnaround” specialist. The bid will leave GKN with over £1.3 billion of debt, while Melrose advisors will gain up to £140 million in fees. Workers believe that they will be expected to pay off the debt through cuts and restructuring.
GKN employs 6,000 workers at 14 sites across the UK. On 28 February, GKN aerospace, automotive and defence workers from sites across the country came to the Houses of Parliament to lobby MPs and call on the government to stop the takeover.
IndustriALL Global Union affiliate Unite is urging the government to block Melrose’s bid in the public interest, on the grounds of national security. GKN supplies and maintains UK defence equipment.
Unite believes that the Melrose bid is using vast loans to lure shareholders with an ‘exceptional dividend’ and then shoulder GKN with debt. The takeover’s focus goes little beyond a pay out to shareholders, banks and Melrose executives who are in line for over £280 million in bonuses. Melrose has no serious long-term plan for GKN’s future, based on investment to defend thousands of highly skilled jobs.
A takeover by Melrose could lead to GKN being sold off piecemeal and jobs cut or shipped abroad.
Unite assistant general secretary for manufacturing Tony Burke said:
“GKN is a world class manufacturer. It is essential to the government’s industrial strategy and is one of the jewels in Britain’s manufacturing crown.
“In Melrose’s hands, all that would be put at risk and ministers’ plans for the UK to be a leader in electric vehicles could be left in tatters.
“Melrose’s debt-fuelled bid would not happen in France or Germany. Theresa May has said she will act in the national interest. It’s time she did and saved British jobs by ensuring her government stopped the GKN takeover.”
IndustriALL and IndustriAll Europe previously wrote to Unite, expressing support for Unite’s position. Speaking ahead of the Parliament rally, assistant general secretary Kemal Özkan said:
“Melrose show no intention of investing in GKN and protecting thousands of skilled jobs. This debt-fuelled deal is designed only to create short term profit for shareholders and bonuses for executives.
“We support Unite in their opposition to speculators who feed on the productive economy.”