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(Reuters) -Jet and auto parts supplier Melrose Industries plans to spin off its GKN automotive unit as a new UK-listed company as it breaks up one of Britain’s oldest engineering businesses, the Financial Times reported on Thursday.
GKN, which supplies parts to carmakers such as Volkswagen AG, aims to trade on the London Stock Exchange next year under a to-be-decided name, the newspaper said, citing people familiar with the matter. ()
Under the plan, turnaround specialist Melrose will separate GKN’s automotive and smaller powder metallurgy businesses from its aerospace arm through a demerger of shares, the FT report said.
Melrose and GKN Automotive did not immediately respond to a Reuters request for comment.
Melrose will retain ownership of GKN Aerospace, a supplier of airframe structures and engine components for aerospace and defence companies including Airbus and Rolls-Royce, according to the report.
The demerged auto group will account for about two-thirds of Melrose’s current projected revenue for 2022 of more than 7.5 billion pounds ($8.63 billion).
Liam Butterworth, the chief executive of GKN Automotive, is expected to become the head of the demerged business, with a separate chair to be appointed later, the report added.
Melrose acquired British engineer GKN in 2018 for $11 billion in a hostile bid. ()
($1 = 0.8693 pounds)
Reporting by Jaiveer Singh Shekhawat in Bengaluru; Editing by Uttaresh.V and Sherry Jacob-Phillips
