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Bloomberg
US buyout firm Advent International Corp agreed to acquire UK defense and aerospace company Cobham Plc for about 4 billion pounds ($5 billion), as cash-flush private-equity firms seek targets in Britain.
Cobham shareholders will receive 165 pence a share in cash, a 34 percent premium to the closing price, the companies said. The stock traded 35 percent higher at 165.35 pence in London.
The purchase of Cobham, which makes electronics, communications gear and specialised equipment for aircraft and ships, marks at least the second takeover of a UK defense firm since the start of 2018, when Melrose Industries Plc bought GKN Plc in a hostile deal.
That purchase initially met pushback from the UK on national security grounds, as has the proposed sale this year of satellite operator Inmarsat Plc to a group of buyout funds.
“There may be regulatory and political scrutiny of this deal,†Neil Wilson, an analyst at Markets.com, said of the Cobham transaction.
June was the busiest month for private-equity purchases of publicly traded UK companies in more than a decade, with $9.8 billion of announced deals, according to data compiled by Bloomberg.
Weakness in the pound, near the lowest in two years against the dollar, has made British companies attractive to overseas buyers, Wilson said.
Cobham, which traces its roots to 1934, has some 11,500 employees globally and customers including Airbus SA, Boeing Co, Lockheed Martin Corp and AP Moller-Maersk A/S. The transaction values Cobham at about 2.1 times trailing 12 months sales, data compiled by Bloomberg show.
In a separate statement, Cobham said first-half revenue increased 11 percent on an organic basis, and the company kept its outlook for the full year unchanged.
The Dorset-based company also began a strategic review of its Australian aviation services business, which has more than 1,300 staff and operates over 50 aircraft for clients including Qantas Airways, the Australian Border Force and Chevron Corp.
Cobham announced an interim dividend of 0.4 pence a share, adding that if the payout record date occurs before the effective date, the acquisition price will be reduced by the amount of the payment.