UK defence firm Ultra Electronics accepts £2.6bn takeover bid from Cobham
Ultra Electronics, a defence supplier to HMRC and the Royal Navy, has accepted a £2.6bn takeover bid from US-owned competitor Cobham.
However, the deal is being monitored by the UK government and Business Secretary Kwasi Kwarteng is looking into the possibility of launching an investigation into the deal under the Enterprise Act, which gives the government the power to intervene in mergers on public interest grounds, such as national security and protecting British interests.
However, Cobham and Ultra stated that both have a history as innovators and share advanced complementary capabilities, delivering mission critical solutions to the US, UK and other key allies. Cobham considers that customers will benefit significantly from the combination, driven by the complementary design, engineering and manufacturing capabilities of the two groups, which will enable the delivery of more integrated and higher performance solutions to its mutual customers and wider stakeholders, including across the ‘five-eyes’ nations.
Cobham recognises the specific importance of Ultra’s contribution to the UK’s economy and national security and therefore Cobham and Cobham Group Holdings have agreed with Ultra in the Cooperation Agreement that they will offer legally binding and enforceable commitments to HM Government in respect of the Ultra Group.
Shonnel Malani, Chairman of the Cobham Group, said: “We believe Cobham and Ultra’s complementary capabilities delivering mission critical technology will be significantly enhanced through the combination of the two groups, enabling the development of higher performance solutions for our customers.
“We recognise the important role that a combined Cobham and Ultra will play in ‘fiveeyes’ defence and are committed to protecting the continuity of supply to the UK and our allies. We look forward to working with HM Government, and other relevant stakeholders, 5 to agree legally binding commitments which safeguard Ultra’s contribution to the UK economy and national security.”