UK moves forward on approving defence firm Ultra’s purchase

By Shanima A and Sinchita Mitra

(Reuters) -Britain on Thursday moved forward on approving the acquisition of London-listed defence firm Ultra Electronics by rival Cobham, owned by U.S. private equity firm Advent, after having raised security concerns over the planned transaction. The UK government has started a consultation process over the 2.57-billion-pound ($3.14 billion) deal, following advice from the Ministry of Defence, and said the Business Secretary “is minded to accept undertakings offered by Cobham” to address the concerns.

“Today’s announcement is a positive step for investment in Ultra,” Cobham Chairman Shonnel Malani said in an emailed statement to Reuters.

Britain had launched a probe into the deal in August last year on possible national security risks, even as Cobham committed to allaying any potential concerns.

Ultra Electronics’ clients include the British and the U.S. governments.

The UK government added in its statement that no decision would be taken by the Business Secretary until the conclusion of the consultation, which is until midnight of July 3, and until after considering representations.

Ultra Electronics did not immediately respond to a Reuters request for comment.

($1 = 0.8177 pounds)

(Reporting by Shanima A and Sinchita Mitra in Bengaluru;Editing by Vinay Dwivedi)