{"id":15296,"date":"2018-05-30T14:51:08","date_gmt":"2018-05-30T13:51:08","guid":{"rendered":"http:\/\/unitelive.org\/?p=15296"},"modified":"2020-11-12T12:58:43","modified_gmt":"2020-11-12T12:58:43","slug":"gkn-melrose-credit-rating-slashed","status":"publish","type":"post","link":"https:\/\/unitelive.test.igniteamt.com\/?p=15296","title":{"rendered":"\u00e2\u20ac\u0098We must act now\u00e2\u20ac\u2122"},"content":{"rendered":"
<\/div>\n

GKN\u00e2\u20ac\u2122s credit rating was this week (May 29) slashed following a hostile takeover by turn-around specialist firm Melrose in March.<\/p>\n

 <\/p>\n

Credit rating firm Moody\u00e2\u20ac\u2122s cut GKN\u00e2\u20ac\u2122s rating from Baa3 to Ba1 \u00e2\u20ac\u201c a rating that\u00e2\u20ac\u2122s considered a \u00e2\u20ac\u0098substantial credit risk\u00e2\u20ac\u2122 for investors. Moody\u00e2\u20ac\u2122s highlighted Melrose\u00e2\u20ac\u2122s \u00e2\u20ac\u015bmore aggressive financial policy\u00e2\u20ac\u0165 and GKN\u00e2\u20ac\u2122s falling profits as reasons for downgrading the rating.<\/p>\n

 <\/p>\n

The \u00c2\u01419bn takeover prompted Moody\u00e2\u20ac\u2122s to review GKN\u00e2\u20ac\u2122s credit rating in April, when\u00c2\u00a0 Moody\u00e2\u20ac\u2122s lead analyst for GKN Matthias Heck said it would investigate \u00e2\u20ac\u015b[takeover]-related uncertainties about GKN\u00e2\u20ac\u2122s future shareholding structure, capital structure and business profile.\u00e2\u20ac\u0165<\/p>\n

 <\/p>\n

The latest downgrade follows another downgrade in March, when the prospect of a potential takeover was imminent.<\/p>\n

 <\/p>\n

Unite and other critics have highlighted the billions in debt that will be fuelling Melrose\u00e2\u20ac\u2122s takeover of GKN \u00e2\u20ac\u201c the firm, known for buying up businesses and selling them on for a profit only a two to five years later, has borrowed \u00c2\u01411.4bn to pay for the takeover and is also borrowing an additional \u00c2\u01411.2bn to pay off existing debt.<\/p>\n

 <\/p>\n

The latest downgrade to Ba1 could shake investor\u00e2\u20ac\u2122s confidence in the firm and make it difficult for Melrose to raise additional money.<\/p>\n

 <\/p>\n

The news of the downgrade comes just weeks after Melrose faced a shareholder revolt<\/a> earlier in May over bosses\u00e2\u20ac\u2122 bonus schemes, with almost a quarter of shareholders rejecting\u00c2\u00a0 pay policies that saw four executives share \u00c2\u0141160m last year.<\/p>\n

 <\/p>\n

Unite general secretary Steve Turner said that the union will continue to fight for its members in GKN and for the thousands of jobs that workers and their local communities depend on.<\/p>\n

 <\/p>\n

Maximum pressure<\/strong><\/em><\/p>\n

\u00e2\u20ac\u015bWe are and will continue to keep maximum pressure on Melrose to deliver on its offer commitments to invest for the long term,\u00e2\u20ac\u0165 he said.<\/p>\n

 <\/p>\n

\u00e2\u20ac\u015bAnd anything that threatens that investment, our members\u00e2\u20ac\u2122 jobs, workplace skills or world class innovation in the business will be resisted by this union both politically and industrially.\u00e2\u20ac\u0165<\/p>\n

 <\/p>\n

After the UK\u00e2\u20ac\u2122s most contentious and bitterly fought takeover in a decade was approved, Unite has continued to lobby for an overhaul of the UK\u00e2\u20ac\u2122s notoriously lax takeover laws.<\/p>\n

 <\/p>\n

Turner has highlighted \u00e2\u20ac\u015beasy measures that would go a long way\u00e2\u20ac\u0165 to protect British businesses, including prohibiting trading in target corporations from the launch of a hostile bid, rewarding long-term shareholders with preferential voting rights, ensuring economic and social considerations are addressed as part of any bid and also ensuring a wider stakeholder agreement is reached as an integral part of the bidding process.<\/p>\n

 <\/p>\n

\u00e2\u20ac\u015bWe must act now to strengthen the ability of government and stakeholders to protect British companies from corporate vultures looking to make a quick buck against the national interest,\u00e2\u20ac\u0165 he said.<\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

GKN\u00e2\u20ac\u2122s credit rating was this week (May 29) slashed following a hostile takeover by turn-around specialist firm Melrose in March.   Credit rating firm Moody\u00e2\u20ac\u2122s cut GKN\u00e2\u20ac\u2122s rating from Baa3 to Ba1 \u00e2\u20ac\u201c a rating that\u00e2\u20ac\u2122s considered a \u00e2\u20ac\u0098substantial credit risk\u00e2\u20ac\u2122 for investors. Moody\u00e2\u20ac\u2122s highlighted Melrose\u00e2\u20ac\u2122s \u00e2\u20ac\u015bmore aggressive financial policy\u00e2\u20ac\u0165 and GKN\u00e2\u20ac\u2122s falling profits as […]<\/p>\n","protected":false},"author":2,"featured_media":2227,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[1],"tags":[624,865,690],"wps_subtitle":"GKN credit rating slashed","_links":{"self":[{"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/posts\/15296"}],"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=15296"}],"version-history":[{"count":2,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/posts\/15296\/revisions"}],"predecessor-version":[{"id":26166,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/posts\/15296\/revisions\/26166"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/media\/2227"}],"wp:attachment":[{"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=15296"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=15296"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=15296"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}