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VT to be saved by white knight?

17 February 2010

The hostile takeover bid for VT Group by Babcock International to create a £2.3 billion defence support services group may be scuppered by the news that US defence company Lockheed Martin could come to its rescue.

Yesterday, FM World reported that VT Group, itself embroiled in a takeover bid for services firm Mouchel, has itself rejected outright an offer from engineering and defence services business Babcock.


Senior management at VT Group said accepting the £1.14bn cash and shares takeover bid by Babcock would be a retrograde move strategically for VT.


Today, The Times has reported that Lockheed Martin could be lined up as a “potential preferred “white knight” bidder for VT in its attempt to see off the unwanted advances of Babcock.”

According to the article, no approach has been made by the American company, but it is said to have considered a move for VT in the past.

Former shipbuilding company VT Group has been distancing itself from reliance on defence contracts, a major market for Babcock whose largest contracts include maintaining submarines and surface naval vessels around the country and also the training of engineers in such work.

Last year VT sold its traditional shipbuilding interests to BAE Systems. Instead, VT has been trying to take over its rival Mouchel, with its most recent bid of £320 million being considered by the smaller firm.