Britain's Melrose ups 'final' offer for GKN to $11.2 billion

London stocks have reversed gains seen at the open

London stocks have reversed gains seen at the open

It has also raised the amount GKN shareholders would own in Melrose following the deal from 57% to 60%.

Melrose Industries has raised the stakes in the takeover battle for GKN with a "final offer" that values the United Kingdom engineering giant at £8.1 billion. It has offered to give back £2.5bn to shareholders and agreed to merge its vehicle unit with United States company Dana.

As of 08:11 GMT, GKN's share price had added 1.75 percent to 442.70p, outperforming the benchmark FTSE 100 index which now stands 0.18 percent higher at 7,237.72 points.

"Instead of #1.4 billion in cash and a majority investment in a stronger combined Melrose / GKN business, it appears the GKN Board prefers a minority stake in a foreign business (Dana) with no GKN management involvement".

Melrose said all recent attempts to engage in "constructive discussions" with GKN had been blocked.

"On the other hand your Board is attempting a hasty fire-sale of GKN businesses before they have been given a chance to reach their potential and with damaging consequences, we believe, for all stakeholders".

Under the new offer, GKN investors would receive 81p in cash for every GKN share they hold, plus 1.69 new Melrose shares.

Hikma Pharmaceuticals Plc said on Monday it plans a new clinical study on its generic version of GlaxoSmithKline's GSK.L popular lung drug Advair, as it looks to resolve an ongoing dispute with the Food and Drug Administration over plans to launch the drug in the U.S.

GKN shareholders have until 29 March to decide whether or not to accept Melrose's offer.

Melrose's share price meanwhile has slipped into the red and is now 0.76 percent lower at 223.00p, as compared with a 0.32 percent gain in the mid-cap FTSE 250 index.

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