TransDigm made an approach worth GBP7bn or 900p last month, trumping an agreed 800p per share/GBP6.7bn offer from Parker, but said today it had decided not to proceed any further.
W. Nicholas Howley, Trasdigm’s chairman, said: “We have long admired and studied the Meggitt business and believed that a combination between the two companies could provide value to investors of both companies.
“However, based on the quite limited due diligence information that was made available and the resulting uncertainties, TransDigm could not conclude that an offer of 900 pence per Meggitt share would meet our long-standing goals for value creation and investor returns.”
Howley added the group had matched commitments made by Parker to the UK government on jobs and security and had reached a memorandum of understanding with Meggitt’s pension plan trustees.
“However, consistent with our disciplined approach to capital allocation, we make acquisitions only when we see a clear path to achieving our investment return goals with a reasonable degree of certainty,” said the statement.
Parker’s deal is being looked at closely by the UK government amid growing concern about the number of takeovers of UK defence companies.
Meggitt shareholders vote on the Parker deal on 21 September.