Job threat Comes alive as British Aerospace Pioneer 'Meggitt' is being taken over by Parker Hannifin Corp. for 6.3 billion pounds.

One of the Oldest British Aerospace company 'Meggitt PLC' has announced Monday that it has agreed to a 6.3 billion pounds ($8.76 billion) takeover by Ohio based Parker Hannifin Corp.

Expected to be the biggest deal for Parker-Hannifin under the Chairman and Chief Executive Officer Tom Williams , Meggitt - the FTSE 250 engineering company that operates in the aerospace, defence and energy markets will nearly double the size of Parker-Hannifin’s aerospace systems unit.

Parker-Hannifin, founded in 1917, has already a significant U.K. presence, that provides hydraulics and pneumatics solutions for aerospace, automotive and heavy industry Players.

Under the deal, shareholders of the U.K. engineering company, that specializes in the aerospace, defense and energy markets, will get 800 pence in cash for each share held, a 71% premium to its closing price of 469.10 pence Friday.

• The board of Meggitt has unanimously recommended that shareholders accept the 800p-a-share deal, which the UK government says it is closely monitoring.
• The deal is the latest example of U.S. buyers eyeing U.K. aerospace. Cobham Ltd., the U.K. defense contractor acquired in 2020 by U.S. private equity firm Advent International Corp.
• The Take over would position the Ohio based company to better compete in the aviation sector that’s just trying to recover from the historical slump.
• Parker-Hannifin is already a defense supplier to the U.K. government.

Parker-Hannifin is not new to the world of take overs , earlier years as well industry has witnessed the company with the $4.3 billion purchase of filtration-products manufacturer Clarcor in 2017, and materials-science specialist Lord Corp. for $3.7 billion in 2019.

“We wanted a price that would be very compelling, that would gain shareholder support and would be very clear that we’re the best owner,” Williams said in an interview. “This is a company we’ve liked for a long time.”

Parker Hannifin said that it will offer a number of legally binding commitments to the U.K. government, including ensuring that Meggitt will continue to meets its contractual obligations, maintaining its U.K. headquarters and ensuring that most of Meggitt's board will be U.K. nationals.

Parker-Hannifin promised to continue supplying the U.K. government, and maintain technology and manufacturing in the country . A majority of Meggitt’s board will remain British.

What about the Jobs ?

Jobs are under threat , if not massive there will be redundancies as Parker-Hannifin's Aerospace wing will have a say in this ! There will be Rationalization post take over , many functions might get a central control from Ohio, things will not be the same as before.

However, CEO Williams said that he’d protect a significant proportion of Meggitt jobs and will seek to grow the business, not break it up.

“That’s not at all our strategy,” Williams said in the interview. “We like the entirety of this business and we intend to own it for a very long time.”

On a conference call, the CEO said the pledge to increase U.K. research and development spending is valid for five years, while the other commitments last for 12 months.