Defense firm Meggitt’s shares rocket on sale to the US giant Parker-Hannifin

The Meggitt plc company logo seen displayed on a smartphone.

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US industrial company Parker-Hannifin has signed a £ 6.3 billion ($ 8.8 billion) deal to buy British defense and the aerospace company Meggitt, the companies announced Monday.

The deal, which will see Parker pay 800p for share, caused Meggitt’s shares to surge more 56% in the morning trade in Europe. Parker’s offer carries a 70.5% premium on Meggitt’s closure share price on Friday. Cleveland-based company shares pulled back slightly in premarket trading in the United States.

In announcement, Parker said he believes the acquisition would be “strategically and culturally compelling” and enhance its value future prospects in the aerospace sector e defense. The deal nearly doubles in size of Parker’s aerospace systems division.

Parker has also made a series of engagements with the British government as a part of the agreement, including maintaining Meggitt’s UK headquarters, guaranteeing a majority of UK citizens remain on the company board, and retaining existing research and development, engineering and manufacturing personnel in The UK

“We firmly believe Parker is right home for Meggit. Together, we can better serve our customers through innovation, accelerated research and development and a complementary portfolio of aerospace e defense technologies”said Tom Williams, Parker president and CEO.

“During our long presence in the United Kingdom we have built great respect for Meggitt, his legacy and his place in British industry “.

Meggitt president Nigel Rudd said he was confident that the American giant would be a “responsible steward” of the company goes forward.

“While Meggitt is currently pursue a strong, autonomous strategy which will bring value to shareholders over the long-term, the Parker offering offers the opportunity to accelerate and significantly reduce those risk plans, while continuing to deliver for shareholders, “Rudd said.

“Parker’s offer also includes far-reaching commitments that ensure that Meggitta remains a significant presence in United Kingdom, increase in investments in research and developmente increasing the number of possibility of apprenticeship “.

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