Two US defence giants ponder Alvis bid

ALVIS IS set to be the subject of intense takeover speculation this week as predators decide whether to launch a bid for the armoured vehicles group.

United Defense Industries and General Dynamics, two US defence manufacturers, are reported to be preparing bids for Alvis. Meanwhile Vickers, the UK engineering firm, also hopes to join the action.

The interest follows last week's merger between Alvis and the Warrior armoured cars division of GKN, the engineering group. The deal heralds the beginning of the long-expected consolidation of the global armoured vehicle industry.

Bidders are interested in Alvis because, following the merger, it will have a strong position in the armoured vehicle market. By taking on GKN's Warrior and Piranha carriers it gains access to a pounds 3bn programme to build battlefield taxis. Vickers was part of a rival consortium which missed out on the contract.

The awarding of the contract is a defining moment in the European armoured vehicle sector, with companies that failed to get any work on the contract forced to merge with other players or exit the industry.

Any takeover would have to gain the approval of GKN, which has taken a 29.9 per cent stake in Alvis as a result of the merger. The stake gives it the power to block any takeover it does not support.

However, the merger will not formally be completed until it is approved by Alvis shareholders in a few weeks' time. This gives other bidders an opportunity to put forward alternative proposals.

United Defense is a privately-owned US group which was created by the merger of two smaller companies four years ago. The group has close links with GKN, as both companies are members of a GEC-led consortium bidding for Project Tracer, the Anglo-American scheme to develop a new hi-tech reconnaissance vehicle.

General Dynamics is a huge group best known for its jet fighter aircraft. It also manufactures the Abrams tank.

News of the American interest is likely to increase the pressure on Vickers. Paul Buysse, the new chief executive of Vickers, has identified defence as one of the group's core activities. However, even though Vickers has a strong position in tanks through its Challenger II vehicle, it lacks the critical mass to compete for projects in its own right.

A shortage of orders was behind Vickers' decision last week to close its Leeds factory with the loss of 1,100 jobs. However, it has a pounds 200m cash pile it could use to make acquisitions.

Alvis makes the Scorpion and Stormer armoured vehicles. The company almost doubled in size last year with the pounds 84m takeover of Hagglunds, the Swedish armoured vehicle manufacturer.

Start your day with The Independent, sign up for daily news emails
Arts and Entertainment
The Ridiculous Six has been produced by Adam Sandler, who also stars in it
filmNew controversy after nine Native American actors walked off set
Ed Miliband, Nick Clegg and David Cameron appeal to the audience during the Question Time special
Danny Jones was in the Wales squad for the 2013 World Cup
rugby leagueKeighley Cougars half-back was taken off after just four minutes
Life and Style
The original ZX Spectrum was simple to plug into your TV and get playing on
techThirty years on, the ZX Spectrum is back, after a fashion
Tiger Woods and Lindsey Vonn are breaking up after nearly three years together
peopleFormer couple announce separation in posts on their websites
ebooksA celebration of British elections
Life and Style
Google celebrates Bartolomeo Cristofori's 360th birthday
techGoogle Doodle to the rescue
Arts and Entertainment
Haunted looks: Matthew Macfadyen and Timothy Spall star in ‘The Enfield Haunting’
tvThe Enfield Haunting, TV review
The Mattehorn stands reflected in Leisee lake near Sunnegga station on June 30, 2013 near Zermatt, Switzerland
Michelle Dockery plays Lady Mary in Downton Abbey
peopleBut who comes top of the wish list?
Miriam Gonzalez Durantez, right, with Lib Dem candidate Jane Dodds in Newtown, Powys, as part of her tour in support of the party’s female candidates
general electionNick Clegg's wife has impressed during the campaign
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Claims Administrator

£16000 - £18500 per annum: Recruitment Genius: This is an excellent opportunit...

Recruitment Genius: Senior SEO Executive

£24000 - £28000 per annum: Recruitment Genius: A Senior SEO Executive is requi...

Recruitment Genius: Online Customer Service Administrator

£16000 - £18000 per annum: Recruitment Genius: An Online customer Service Admi...

Recruitment Genius: Digital Marketing Executive

£18000 - £22000 per annum: Recruitment Genius: This global, industry leading, ...

Day In a Page

Fishing for votes with Nigel Farage: The Ukip leader shows how he can work an audience as he casts his line to the disaffected of Grimsby

Fishing is on Nigel Farage's mind

Ukip leader casts a line to the disaffected
Who is bombing whom in the Middle East? It's amazing they don't all hit each other

Who is bombing whom in the Middle East?

Robert Fisk untangles the countries and factions
China's influence on fashion: At the top of the game both creatively and commercially

China's influence on fashion

At the top of the game both creatively and commercially
Lord O’Donnell: Former cabinet secretary on the election and life away from the levers of power

The man known as GOD has a reputation for getting the job done

Lord O'Donnell's three principles of rule
Rainbow shades: It's all bright on the night

Rainbow shades

It's all bright on the night
'It was first time I had ever tasted chocolate. I kept a piece, and when Amsterdam was liberated, I gave it to the first Allied soldier I saw'

Bread from heaven

Dutch survivors thank RAF for World War II drop that saved millions
Britain will be 'run for the wealthy and powerful' if Tories retain power - Labour

How 'the Axe' helped Labour

UK will be 'run for the wealthy and powerful' if Tories retain power
Rare and exclusive video shows the horrific price paid by activists for challenging the rule of jihadist extremists in Syria

The price to be paid for challenging the rule of extremists

A revolution now 'consuming its own children'
Welcome to the world of Megagames

Welcome to the world of Megagames

300 players take part in Watch the Skies! board game in London
'Nymphomaniac' actress reveals what it was really like to star in one of the most explicit films ever

Charlotte Gainsbourg on 'Nymphomaniac'

Starring in one of the most explicit films ever
Robert Fisk in Abu Dhabi: The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers

Robert Fisk in Abu Dhabi

The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers
Vince Cable interview: Charging fees for employment tribunals was 'a very bad move'

Vince Cable exclusive interview

Charging fees for employment tribunals was 'a very bad move'
Iwan Rheon interview: Game of Thrones star returns to his Welsh roots to record debut album

Iwan Rheon is returning to his Welsh roots

Rheon is best known for his role as the Bastard of Bolton. It's gruelling playing a sadistic torturer, he tells Craig McLean, but it hasn't stopped him recording an album of Welsh psychedelia
Russell Brand's interview with Ed Miliband has got everyone talking about The Trews

Everyone is talking about The Trews

Russell Brand's 'true news' videos attract millions of viewers. But today's 'Milibrand' interview introduced his resolutely amateurish style to a whole new crowd
Morne Hardenberg interview: Cameraman for BBC's upcoming show Shark on filming the ocean's most dangerous predator

It's time for my close-up

Meet the man who films great whites for a living