Advent plans Cobham job guarantees as it seeks government approval
Private equity giant Advent International is ready to commit to the Government that it will protect UK jobs at Cobham as it seeks approval for its £4 billion takeover of the defence firm.
Advent secured the deal to buy Cobham in July but has affirmed its commitment to support the UK business after business secretary Andrea Leadsom called on the competition watchdog to assess the deal.
It is understood that Advent intends to allay concerns that it could break up the company or cut roles.
The PE giant is expected to commit to keep UK employment at current levels, invest in research and development in the UK and maintain the Cobham brand.
Shareholders in the company voted overwhelmingly to approve the acquisition last month but the deal has faced fierce criticism from Lady Nadine Cobham, whose late husband Michael ran the business.
Lady Cobham called on the government to halt the deal in order to safeguard hi-tech jobs and protect national security.
The business secretary subsequently called on the Competition and Markets Authority (CMA) to intervene and assess the security implications of the aerospace firm’s takeover.
The regulator has until Tuesday October 29 to report back to her regarding the impact of the deal.
Cobham employs around 10,000 people, including 1,700 in the UK, and is best known for its air-to-air refuelling technology.
It became the target of takeover interest after its share value slumped on the back of a raft of profit warnings and contract disputes.
Writing in a letter published in The Times, Cobham chairman James Pike said the deal is an “important opportunity for growth – growth that could secure high-value British jobs and strengthen the defence industry in the UK”.
He added: “Under Advent’s ownership, Cobham will be able to compete for a significantly greater proportion of the US defence market, which cannot be procured from non-US companies.
“This is an important moment for Cobham, one which will define its future, unlocking opportunities for growth, job creation and benefits for all of its stakeholders.”
Shonnel Malani, managing director at Advent International, said: “Advent will be a responsible owner of Cobham. From the outset we have been willing to work with the government to provide undertakings to ensure that we protect jobs and investment in research and development in the UK.
“We are also confident that by opening up opportunities in the United States and other markets, we will be able to grow Cobham’s UK operations.”