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British engineering firm agree £6.3bn takeover by US tech giant

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Defence and aerospace technology firm Meggitt has agreed a £6.3bn takeover deal by US firm Parker-Hannifin.

The FTSE 250 company confirmed an offer from the US engineering technology giant valuing Meggitt at 800p per share.

It said the move represents a 70% premium on the share value of the company at the end of trading on Friday, when it was at 469.1p per share.

Tom Williams, chairman and chief executive of Parker-Hannifin, said: “We are committed to being a responsible steward of Meggitt and are pleased our acquisition has the full support of Meggitt’s board.

“We fully understand these responsibilities and are making a number of strong commitments that reflect them.

“During our longstanding presence in the UK we have built great respect for Meggitt, its heritage, and its place in British industry.”

Meggitt chairman Sir Nigel Rudd said: “Meggitt is one of the world’s foremost aerospace, defence and energy businesses, leading the market with a strong portfolio of technology and manufacturing capabilities, and holding a significant amount of intellectual property.

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“Whilst Meggitt is currently pursuing a strong, standalone strategy which will deliver value to shareholders over the long-term, Parker’s offer provides the opportunity to significantly accelerate and de-risk those plans, while continuing to deliver for shareholders.”

Chief executive Tony Wood said: “Bringing together the Meggitt and Parker businesses will provide increased benefit to the UK with the provision of technologies, products and capabilities through Meggitt, and a leading aerospace business in Parker.

“The offer from Parker is an endorsement of the work undertaken to transform the Meggitt Group in recent years, and the combined group will maximise the opportunities for future growth and profitability with a shared commitment to operational excellence, allowing us to continue to invest in our people, products and services for customers worldwide for years to come.”

Meggitt is the second British defence firm in recent weeks to become a takeover target for a US-backed company, following Cobham’s bid for Ultra Electronics.

Cobham has said it would offer “appropriate national security undertakings” to the UK government.

Meggitt employs more than 9,000 people in 14 countries in its three major divisions.