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LONDON, Sept 18 (Reuters) - The $5 billion acquisition of
British defence company Cobham by U.S. private equity
firm Advent International could be blocked on national security
grounds after the government ordered an investigation into the
agreed deal.
Business minister Andrea Leadsom has issued a European
intervention notice, calling for a report from the Competition
and Markets Authority (CMA) by Oct. 29 to determine whether the
deal should go ahead.
Shareholders in the British aerospace and defence company
approved the takeover on Monday.
"The CMA will now prepare a report on the national security
aspects of the proposed transaction. This is a statutory process
to ensure national security implications of a proposed sale are
fully assessed," the business department said.
Cobham, which employs 10,000 people to make its air-to-air
refuelling system and communications equipment for military
vehicles, has a storied history but has faced difficulties in
recent years.
The group issued a string of profit warnings in 2016 and
2017 that forced it to raise cash from shareholders, and some
investors complained that the offer price of 165 pence per share
was too low.
Britain, hit by a weak pound due to the uncertainty over
Brexit, is also scrutinising the acquisition of satellite
communications firm Inmarsat by another private equity
led consortium, on the potential impact to national security.
(Reporting by Kate Holton; editing by James Davey)
