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Engineering giant GKN rejects £7bn takeover bid

Shares in GKN, one of the UK's biggest engineering firms, have soared after it rejected a bid that values the company at £7bn.

Melrose made the unsolicited offer of 405p a share on 8 January.

Shares in GKN, which makes wing tips for Airbus planes and parts for Porsche cars, closed more than 26% higher at 420p.

Its board said the cash and shares bid was "entirely opportunistic" and "fundamentally" undervalued GKN.

Shares in Melrose, a manufacturing turnaround firm, also rose sharply, adding 7% to 229p. Takeover rules mean it must make a firm offer by 9 February or walk away for six months.

Liberal Democrat leader Vince Cable called on Business Secretary Greg Clark to block the takeover: "GKN stands for long term investment in advanced manufacturing whereas Melrose are in the business of short-term financial engineering."

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