By Emmanuel Oluebube, Correspondent UK

The statement by Meggitt stating its confidence that its acquisition by US owned Parker-Hannifin will be completed as planned in 2022, has got the analyst community reacting.

Associate Defense Analyst at GlobalData, Madeline Wild, comments: “Referral of the acquisition to the competitions and market authority is made possible by the National Security and Investment (NSI) Act 2021. Showing its utility in the protection of the UK defense industry, the act allows the government to intervene and investigate deals within sensitive industries. The act aims to safeguard and protect the domestic development of key emerging technologies.

“The takeover of Meggitt by Parker-Hannifin is worth a sizeable £6.3bnbillion(US$8.7billion). The British firm produces avionics, braking systems and defense systems, including parts for the F-35 Lightning II aircraft. According to GlobalData, the company recorded a revenue of US$2.2bn in 2020, which is a -25.65 per cent growth rate from 2019. Furthermore, GlobalData can reveal that Meggitt’s net income reduced by 241.84 per cent over the same period. This may go some way to explain the confidence exhibited by the parties involved in the acquisition. While the company still maintains a large industry presence, the financial difficulties faced during the COVID-19 period may make it more liable to passing any UK Government enforced checks.”