24 March 2022

UK CMA finishes reviewing Parker Hannifin's bid for Meggitt

by Marc Selinger

Meggitt provides ammunition handling systems for military helicopters, including the Boeing AH-64 Apache. (Janes/Patrick Allen)

The UK Competition and Markets Authority (CMA) has completed its assessment of whether Parker Hannifin Corporation's proposed acquisition of Meggitt raises national security concerns, according to the government.

UK Secretary of State for Business, Energy, and Industrial Strategy Kwasi Kwarteng, who requested the review in October 2021, will consider the CMA's findings before deciding on next steps, including whether the acquisition should receive further scrutiny or be approved with conditions, a government spokesperson said on 22 March. While Kwarteng has not indicated what national security concerns might exist, Parker is headquartered in the United States and Meggitt is based in the United Kingdom.

Parker has proposed paying GBP6.3 billion (USD8.3 billion) for Meggitt, saying the two aerospace suppliers could better serve their customers by combining their complementary portfolios. Both companies make motion and control systems.

In January 2022, the CMA completed a similar Kwarteng-requested review of Cobham Group's proposed acquisition of Ultra Electronics. Kwarteng is weighing those findings as well.

Cobham has offered GBP2.6 billion for Ultra, saying the combination would create a “global defence electronics champion”. Although Cobham and Ultra are both based in the UK, Cobham is owned by US private equity firm Advent International, which has come under fire for divesting several Cobham businesses since it bought the storied company in January 2020.

Advent, Cobham, and Ultra are all “engaging constructively” with the UK government, including the Ministry of Defence, “with a view to ensuring that the UK's national interests are appropriately protected as part of the recommended transaction“, Ultra said on 23 March.

The UK Competition and Markets Authority (CMA) has completed its assessment of whether Parker Hannif...

Jane's Find unrivaled intelligence, consultancy and advertising solutions to the defence and national security sectors.