Updates

GKN - Concerns over China auto slowdown

October 2015

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

GKN has announced the acquisition of Fokker Technologies, a specialist tier 1 aerospace supplier in aerostructures, electrical wiring systems and landing gear across commercial, military and business jet end markets. Strategically, Fokker is a good fit as it takes it to number two in aerostructures and no. three in electrical wiring systems and strengthens its position in China, Turkey, India and Mexico. The price paid is £499m, representing an enterprise value / EBITDA multiple of 8.4x FY’15 pre synergies and has led to small upgrades for both FY’16 and FY’17.GKN also announced interims that showed a 4% increase in pretax profit to £307m and 1% rise in eps to 14.5p. Aerospace, which supplies engine co ...

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With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

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