The ongoing acquisition of UK defence firms by overseas competitors looks set to continue following the announced agreement for the £2.6bn (US$3.59bn) acquisition of Ultra Electronics by US-owned Cobham Group.
In an August 16 statement to the London Stock Exchange it was disclosed that upon completion of the acquisition of Ultra Electronics by Cobham that UK-specific national security interests would be upheld and a UK headquarters maintained. The acquisition is expected to become effective in Q1 2022.
Mark Esper, former US Secretary of Defense and non-executive director of Cobham AES, said: "As a former US Secretary of Defence, I have seen first-hand the enduring importance of a close military relationship between the UK and the US. I am also aware of the evolving threats our two nations, and our allies, face.
“As such, it is essential that we have defence companies capable of meeting our joint security needs. The enhanced capabilities of a combined Cobham and Ultra promise to deliver significant benefits to both countries."
Ultra Electronics is a key supplier of aerospace and defence systems to the UK and global defence markets, including strong presences in North America. In March this year the company was awarded a £31m three-year follow-on capability contract by the UK Ministry of Defence to supply sonobuoys for the Royal Navy’s Merlin maritime patrol helicopter from 2022.
The company also supplies components to a number of UK defence platforms, including the Eurofighter Typhoon.
The agreement comes on the heels of the August 2 announcement by US aerospace systems manufacturer Parker-Hannifin on the agreed purchase of Coventry-headquartered Meggitt in a proposed £6.3bn deal.
Cobham itself was bought by US private equity firm Advent in 2019 in a £4bn deal. In February 2021, US-based power management company Eaton agreed a deal to acquire Cobham’s Missions Systems business segment for US$2.83bn, which is expected to close in the second half of the year.
