The government has approved a US private equity firm’s takeover of UK defence and aerospace company Cobham.
Advent International made a £4bn offer to buy Cobham in July and shareholders approved the deal in August.
A government report found the merger caused some national security risks, but said on Friday concerns had been mitigated to an “acceptable level”.
The founding family of the firm said the announcement on Friday evening was “cynically timed to avoid scrutiny”.
Cobham, which employs 10,000 people, has extensive contracts with the British military and is seen as a world leader in air-to-air refuelling technology.
The firm, based in Wimborne, Dorset, also makes electronic warfare systems and communications for military vehicles.
Its expertise played a significant role in the Falklands War, allowing the Royal Air Force to attack the remote Port Stanley airfield.
Defence experts said its role in air-to-air refuelling was essential for modern warfare and could raise national security issues if the company was sold.
In September the government intervened in the takeover, citing national security concerns.
But in a statement on Friday, Business Secretary Andrea Leadsom said she was satisfied the risks that had been identified had been mitigated “to an acceptable level” – and allowed the deal to go ahead.
Mrs Leadsom said the decision had been “meticulously thought over” and came after she took advice from the defence secretary and the deputy national security adviser.
Just before 10pm on a Friday is an odd time for this kind of thing to be announced.
One defence analyst remarked that it was as if the government rather wanted no-one to notice what had happened.
The curious timing may actually draw more attention than if it had been done at a more normal hour – few doubted the government would block the deal, and shareholders in Cobham have already voted overwhelmingly in favour.
It says something of the sensitive nature of Cobham’s business that much of the published version of the competition regulator’s report on the takeover was simply blacked out.
In one unedited passage of the report, the Ministry of Defence said if the deal went ahead there was “a risk that the institutional framework and safeguards required by the government’s security framework may be undermined”.
The business secretary added sensitive government information would continued to be protected under the new owner and existing contracts would be honoured.
The company is also obliged to give the government prior notice of any plans to sell the whole, or elements of, Cobham’s business.
However, Lady Nadine Cobham – part of the family which set up the UK firm – called the decision “deeply disappointing” and criticised the timing of the decision, announced late on Friday night.
Lady Cobham said it was “cynically timed to avoid scrutiny on the weekend before Christmas”.
She has previously warned the deal could jeopardise the UK’s capacity for mid-air refuelling.
Lady Cobham, the widow of Sir Alan’s son, Sir Michael Cobham, said: “In one of its first major economic decisions, the government is not taking back control so much as handing it away.
“In Cobham we stand to lose yet another great British defence manufacturer to foreign ownership, through a takeover that would never have been approved by the Americans, French or Japanese, all of whom have taken steps recently to raise protections for their own defence sectors.”
Cobham plc is a group of defence and technology businesses which started out as a family firm founded by Sir Alan Cobham.
Sir Alan became a flying instructor in 1918 after volunteering to join the Royal Air Force during World War One.
He received a knighthood from King George V in 1926 for his pioneering work in aviation.
Sir Alan became a household name after devising Cobham’s Flying Circus in the early 1930s. The aeronautical acrobatics show toured England and South Africa.
He then went on to focus on air-to-air refuelling and formed Flight Refuelling Limited in 1934, which developed into Cobham plc as it is known today.
Aside from aviation, Cobham’s innovations include lightweight tanks, radar technology for maritime defence and spacecraft technology.