{"id":14726,"date":"2018-03-06T16:31:21","date_gmt":"2018-03-06T16:31:21","guid":{"rendered":"http:\/\/unitelive.org\/?p=14726"},"modified":"2020-11-12T12:59:07","modified_gmt":"2020-11-12T12:59:07","slug":"gkn-takeover-probed-beis-hearing","status":"publish","type":"post","link":"https:\/\/unitelive.test.igniteamt.com\/?p=14726","title":{"rendered":"MPs grill Melrose bosses"},"content":{"rendered":"
<\/div>\n

MPs grilled Melrose executives today (March 6) over their takeover bid of engineering giant GKN at a business select committee hearing, where Unite representatives also gave evidence.<\/p>\n

 <\/p>\n

The hearing comes as Unite is lobbying the government to block\u00c2\u00a0the debt-fuelled takeover <\/a>bid\u00c2\u00a0by Melrose, which specialises in buying and selling companies to maximise shareholder value at the expense of the long-term health of their businesses.<\/p>\n

 <\/p>\n

GKN finance chief Jos Sclater explained how his company’s business model was totally at odds with Melrose’s short-term approach.<\/p>\n

 <\/p>\n

\u00e2\u20ac\u015bIt\u00e2\u20ac\u2122s short-term capitalism versus long-term capitalism,” he said. “You are investing for your grandchildren, that\u00e2\u20ac\u2122s what we\u00e2\u20ac\u2122ve been doing and that\u00e2\u20ac\u2122s what we want to carry on doing.”<\/p>\n

 <\/p>\n

Commitments<\/strong><\/h2>\n

Committee chair Rachel Reeves asked Melrose chief executive Simon Peckham why the company was unwilling to give any assurances to the workforce even as he claimed Melrose had their long-term interests at heart.<\/p>\n

 <\/p>\n

\u00e2\u20ac\u015bYou said earlier you were going to sack the board and empower the people who work in the business to make decisions because they are the people who best understand it,\u00e2\u20ac\u0165 Reeves said. \u00e2\u20ac\u015bI find it a little surprising that you haven\u00e2\u20ac\u2122t met with the people who represent those workers, their trade union Unite.\u00e2\u20ac\u0165<\/p>\n

 <\/p>\n

Peckham said only that they were \u00e2\u20ac\u015bgetting closer” to the appropriate time to meet with Unite \u00e2\u20ac\u201c Reeves then pressured him until he committed to meeting with the union this month.<\/p>\n

 <\/p>\n

Melrose executives refused to make any further commitments, responding to questions about their intentions over the long-term future of the business by imploring MPs to \u00e2\u20ac\u015blook at our record.\u00e2\u20ac\u0165<\/p>\n

 <\/p>\n

But as Unite assistant general secretary Tony Burke later highlighted at the hearing, Melrose\u00e2\u20ac\u2122s record speaks volumes. He pointed to a series of companies that Melrose bought only to start selling off parts of each business within a year or two.<\/p>\n

 <\/p>\n

\u00e2\u20ac\u015bThat is their record,\u00e2\u20ac\u0165 Burke said.<\/p>\n

 <\/p>\n

Unite assistant general secretary Steve Turner highlighted the poor industrial relations Unite has with Melrose at Brush Turbogenerators<\/a>, a company bought by Melrose in 2008.<\/p>\n

 <\/p>\n

\u00e2\u20ac\u015bWhen they assumed control there were 1200 employees and in a very short period of time that was reduced to 600 employees. And on the day of their proposed [GKN] bid being released they decided to halve that by another 50 per cent and offshored jobs to eastern Europe,\u00e2\u20ac\u0165 he told MPs.<\/p>\n

 <\/p>\n

National security<\/strong><\/h2>\n

Turner highlighted the various defence products and programmes in which GKN is involved, such as the Apache, the Black Hawk, the Typhoon Eurofighter and others, as he made the case for the Melrose bid to be blocked on national security grounds.<\/p>\n

 <\/p>\n

\u00e2\u20ac\u015bNational security works over a 15 to 20 year development period \u00e2\u20ac\u201c let alone the manufacturing process which will go on for 30 or 40 years in service,\u00e2\u20ac\u0165 Turner noted, pointing to the fact that GKN has invested for these long-term cycles whereas Melrose buys and sells companies in the short-term.<\/p>\n

 <\/p>\n

Turner slammed Melrose\u00e2\u20ac\u2122s business model saying that it was only about \u00e2\u20ac\u015bmaximising shareholder value and trousering a lot of money.\u00e2\u20ac\u0165<\/p>\n

 <\/p>\n

Indeed, earlier in the hearing Melrose executives were forced to admit their millions of pounds in bonuses operated under a scheme that only incentivised shareholder value.<\/p>\n

 <\/p>\n

\u00e2\u20ac\u015bIf you can get away with it great but it’s not very good for UK plc,\u00e2\u20ac\u0165 Turner said of their business model. \u00e2\u20ac\u015bAnd we’ll oppose it every step of the way.\u00e2\u20ac\u0165<\/p>\n

 <\/p>\n

Burke added that the voices of the 6,000-strong GKN workforce must be heard and their concerns addressed.<\/p>\n

 <\/p>\n

\u00e2\u20ac\u015bAt the end of the day this is about people \u00e2\u20ac\u201c this is about workers,\u00e2\u20ac\u0165 he said. \u00e2\u20ac\u015bWorkers have been with this company for many, many years. They’ve invested their lives and skills in GKN.\u00e2\u20ac\u0165<\/p>\n

 <\/p>\n

The committee demanded that Melrose write to MPs later in the week outlining the company\u00e2\u20ac\u2122s specific intentions if the takeover were to go ahead.<\/p>\n

 <\/p>\n

Block the bid<\/strong><\/h2>\n

The hearing comes as a group of 16 MPs \u00e2\u20ac\u201c led by Labour MP Jack Dromey and Tory MP Rachel Maclean \u00e2\u20ac\u201c called on the business secretary Greg Clark to block the bid.<\/a><\/p>\n

 <\/p>\n

The cross-party MPs wrote to Clark arguing what Unite has said from the beginning \u00e2\u20ac\u201c that allowing the bid to go through would threaten UK national security interests as well as thousands of highly skilled jobs.<\/p>\n

 <\/p>\n

The Pensions Regulator has also written to the Work and Pensions Committee expressing fears over pensions<\/a> should Melrose take over GKN.<\/p>\n

 <\/p>\n

\u00e2\u20ac\u015bFrom the outset we have been concerned that the increased leverage involved in the proposed takeover by Melrose is likely to have a detrimental impact on [the ability of Melrose to fulfil its pensions obligations],\u00e2\u20ac\u0165 the letter read.<\/p>\n

 <\/p>\n

Solidarity demo<\/strong><\/h2>\n

Meanwhile, Unite members from Jaguar Land Rover and other carmakers are set to join GKN Driveline workers in a show of solidarity tomorrow (March 7) to urge the government to block the Melrose bid in the national interest.<\/p>\n

 <\/p>\n

Unite acting automotive national officer Carol Tallentire said GKN\u00e2\u20ac\u2122s Driveline business is \u00e2\u20ac\u015bat the heart of the UK automotive industry and a major employer in Birmingham and the West Midlands.<\/p>\n

 <\/p>\n

\u00e2\u20ac\u015bIn Melrose\u00e2\u20ac\u2122s hands, all that would be put at risk and ministers\u00e2\u20ac\u2122 plans for the UK to be a leader in electric vehicles could be left in tatters,\u00e2\u20ac\u0165 she said.<\/p>\n

 <\/p>\n

\u00e2\u20ac\u015bGKN will be saddled with over \u00c2\u01411.3 billion of debt if Melrose succeeds, while its advisors would pocket upwards of \u00c2\u0141140 million in fees,\u00e2\u20ac\u0165 Tallentire added. \u00e2\u20ac\u015bWorkers are fearful that they will pay for this debt fuelled payday with their livelihoods with technology and jobs shipped abroad.<\/p>\n

 <\/p>\n

\u00e2\u20ac\u015bMelrose\u00e2\u20ac\u2122s debt-fuelled bid would not happen in France or Germany. Theresa May has said she will act in the national interest. It\u00e2\u20ac\u2122s time she did and saved British jobs by ensuring her government stopped the GKN takeover.\u00e2\u20ac\u0165<\/p>\n

 <\/p>\n

You can watch today\u00e2\u20ac\u2122s full hearing on Parliament.tv.<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

MPs grilled Melrose executives today (March 6) over their takeover bid of engineering giant GKN at a business select committee hearing, where Unite representatives also gave evidence.   The hearing comes as Unite is lobbying the government to block\u00c2\u00a0the debt-fuelled takeover bid\u00c2\u00a0by Melrose, which specialises in buying and selling companies to maximise shareholder value at […]<\/p>\n","protected":false},"author":2,"featured_media":14727,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[17],"tags":[624,865,874],"wps_subtitle":"Unite gives evidence against GKN takeover","_links":{"self":[{"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/posts\/14726"}],"collection":[{"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=14726"}],"version-history":[{"count":3,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/posts\/14726\/revisions"}],"predecessor-version":[{"id":26358,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/posts\/14726\/revisions\/26358"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/media\/14727"}],"wp:attachment":[{"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=14726"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=14726"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=14726"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}