Foreign corporations step up their assault as they gobble up British firms
British firms are being gobbled up at a record rate by foreign corporations despite lingering concerns over the long-term health of the UK economy.
In 2010, £65billion flooded into the economy as overseas companies sought to take advantage of Britain’s ‘laissez-faire’ attitude to foreign takeovers, according to research by Dealogic.
Only America was the target of more foreign acquisitions this year, with 1,216 deals completed, worth £130billion.
In Britain, the year started with a bang when chocolate maker Cadbury was snapped up by American rival Kraft for £11.5billion.
Other major deals completed in 2010 include the £1.8billion takeover of Dana Petroleum by KNOC of Korea; Deutsche Bahn’s £2.4billion acquisition of Arriva; and News Corp’s ongoing struggle to buy the remaining 61pc of satellite tV firm BskyB for £8.7billion.
Foreign private equity firms and sovereign wealth funds also grabbed the headlines.
In July tomkins, a British engineering firm founded in 1925, was bought by a consortium including Onex Corporation, Canada’s biggest buyout firm, for £2.9billion.
And in May the famous British department store harrods found itself in the odd position of being tossed from one pair of foreign hands to another after being sold by Mohamed Al Fayed to the Qatari royal family for £1.5billion.
UK plc’s latest car-boot sale is partly explained by British takeover laws, among the laxest in the world.
Even Canada and Australia have spent the past year tightening up takeover laws, with Ottawa in particular bridling at Anglo-Australian miner BHP Billiton’s £25billion hostile bid for Canada’s Potash Corporation.
Some countries – notably China and France – ring-fence large chunks of their economy in the guise of national or strategic security.