Jeremy Corbyn pledged that a Labour government would make it harder for asset strippers to take over U.K. companies while vowing to make finance the “servants of industry not the masters of us all.”
While his full-throttle attacks on bankers have been become familiar to the City of London, his prescription for blocking hostile takeovers is specific and likely to rattle the world of business.
In a speech to the EEF manufacturers’ organisation, he will evoke the case of Melrose Industries Plc’s bid for GKN Plc as an example where action to fend off the turnaround specialist is justified. If elected, Corbyn would broaden the scope of the “public interest test” to allow the government to act.
“Take GKN, one of the world’s oldest and most prestigious engineering firms, which employs 6,000 workers across the U.K.,” Corbyn will say on Tuesday. “And yet GKN is currently facing a hostile, allegedly debt-fuelled takeover bid by Melrose, a company with a history of opportunistic asset-stripping.”
“It’s an all too familiar story, like when Kraft took over Cadburys,” Corbyn will tell an audience of manufacturers at their annual conference in London. “A valuable company could be sacrificed so that a few can make a quick buck.”
Understand that it is important to actually have credibility to make such a claim, which means that things like paid speaking gigs at Wall Street or fundraising appeals to that same boulevard tend to eliminate this as a valid tactic.
If you want to talk the talk, you have to walk the walk, as Corbyn has done for decades.